The government has yet to decide on low-cost carrier AirAsia’s proposal to shift KL International Airport’s (KLIA) low- cost carrier terminal (LCCT) to Labu in Negeri Sembilan, Deputy Prime Minister Datuk Seri Najib Tun Razak said today.

“We are looking at it but have yet to make any decision. I cannot pre-empt the decision by making an announcement,” he said.

He was speaking to reporters after witnessing the handing over of the Bombardier CL415 amphibious aircraft to the Malaysian Maritime Enforcement Agency at the Sultan Abdul Aziz Shah Airport in Subang today.

Najib said the government was studying the Labu LCCT proposal to see “if we can go ahead or we need to make a different arrangement.”

To be called KLIA-East @ Labu, the proposed new low-cost carrier terminal is expected to sustain AirAsia’s exponential growth as opposed to the LCCT at the KLIA from where it is operating now.

AirAsia chief executive officer Datuk Seri Tony Fernandes earlier this month said that the country’s premier low-cost carrier would go bust if it sticks to the KLIA LCCT, as it would be unable to handle passenger growth a few years from now.

The new LCCT, to cost RM1.6 billion on a 2,800-hectare site, would be built under the private financing initiative by conglomerate Sime Darby Berhad and the budget airline.

If the government gives the green light for the project, the new LCCT is expected to be ready by March 2011.

— BERNAMA