Malaysia today said it hopes to sign an aviation pact with Singapore by the end of the month, allowing budget airlines to fly between the neighbouring nations and ending the national carriers' monopoly.

Malaysia Airlines and Singapore Airlines have enjoyed a lucrative 35-year stranglehold on the Kuala Lumpur-Singapore route, but the two governments recently agreed to open it up to competition.

Transport Minister Chan Kong Choy said Malaysia has submitted proposals to the Singapore government for consideration during mid-November aviation talks in the island republic.

"I have officially put in the Malaysian proposals to my counterpart in Singapore, Minister Raymond Lim, and we both agreed it should be discussed further," he was quoted saying by the official Bernama news agency.

Prime Minister Abdullah Ahmad Badawi said in October that Malaysia-based low-cost carrier AirAsia will be allowed to operate two Kuala Lumpur-Singapore flights daily.

Singaporean budget airline Tiger Airways, which is backed by Singapore Airlines, is also keen to fly the route.

AirAsia chief executive Tony Fernandes has said it hopes to launch the route in December, with fares about 50 to 60 percent cheaper than current prices at about RM150 Malaysian for a one-way ticket including taxes.

A return ticket between the cities on national carriers costs about US$319.