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Rafidah Aziz, Malaysia's trade minister was quoted as saying a bilateral trade pact could boost Malaysia's exports to India by 1.3 times, or 12 billion dollars, by 2012.
The talks would aim for a comprehensive bilateral FTA covering trade in goods and services, investments and economic cooperation, the New Straits Times newspaper reported her saying.
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Last year, India was Malaysia's ninth largest trading partner, ninth largest export destination and 17th largest import source.
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India is also negotiating an FTA with the 10-member Association of Southeast Asian Nations of which Malaysia is a member, the reports said, adding that New Delhi hoped the pact would be in place by May 2008.
Malaysia is also negotiating trade pacts with the US, Australia, New Zealand and Chile.
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