Malaysian Prime Minister Abdullah Ahmad Badawi today called for more joint projects with Japan including research in alternative fuels.

Meeting with his Japanese counterpart Junichiro Koizumi, Abdullah praised the "steady progress" in trade since the two countries last year inked a free-trade pact.

"He said the agreement will lead to visible expansion of bilateral trade in the future," the Japanese foreign ministry in a statement.

The Malaysian leader said he wanted Japan to work with his country in the biotechnology field, especially to study palm oil to develop alternative fuel to oil, the statement said.

In response, Koizumi said he also considered joint projects in biotechnology and alternative energy important, particularly in the light of rising oil prices.

Abdullah and Koizumi signed in December the trade pact which will abolish tariffs on nearly all industrial goods and agricultural products within a decade.