The government will extend cash incentives to air cargo operators in yet another attempt to boost business at its main international airport, reports said today.

As part of a campaign to turn the Kuala Lumpur International Airport (KLIA) into a regional aviation hub, cash incentives currently offered to passenger airlines will also be offered to air cargo operators.

"The air freight industry is going to grow fast, as people have to ship goods much faster nowadays," Transport Minister Ling Liong Sik was quoted by the New Straits Times daily as saying.

Last week, Malaysia unveiled a RM10 million incentive scheme where new carriers flying into the four-year-old KLIA will be paid RM1 for every ringgit spent on promotional activities such as advertising in Malaysia.

The scheme was in addition to a RM10 million marketing campaign by airport operator Malaysia Airports Holdings to promote KLIA this year.

The government has already waived parking and landing fees for the next five years for new services to the airport as it seeks to compete with neighbouring Singapore.

Airlines withdrawal

The under-utilised RM9 billion KLIA, located south of Kuala Lumpur, handled only 14.6 million passengers last year, well below its 25 million capacity.

Since its launch in 1998, the KLIA has been hit by the withdrawal of several top airlines, including British Airways, Qantas and Lufthansa.

The three airlines earlier this month said they had rejected strong overtures to relocate their regional hubs in Malaysia.