BANGKOK, Nov 3 — Malaysia remains friendly with India and is keen for both countries to enjoy better business relations, Tun Dr Mahathir Mohamad said today after fears of a trade backlash over his remarks about its restive Kashmir region previously.

The prime minister had earlier participated in the 16th Asean-India Summit, which was among several related meetings held in conjunction with the 35th Asean Summit hosted by Thailand this year.

"With India, we have no problem. Basically, we want to increase trade and investment.

"We find India to be very positive on these issues and hope it will be translated into action by India and Asean countries,” he told Malaysian media this afternoon.

Some Indian trade organisations have been pushing its government to boycott importing Malaysian palm oil products after Dr Mahathir criticised the republic’s military action in the Muslim-majority Kashmir region.

But the Indian government has not officially made a stand on the boycott call.

Malaysia, together with Indonesia, are the world’s biggest producer of palm oil products. Both South-east Asian nations have come under pressure from the west for its vast oil palm plantations, with campaigners claiming the large-scale farming was causing deforestation and loss of precious flora and fauna.

Dr Mahathir also said China, which is also attending a separate summit with Asean member states, has been positive to the geo-political and economic concerns raised during talks.

"China also subscribes to a peaceful South China Sea,” he said, without elaborating.

The Asian powerhouse and the US, which are facing off against each other economically, have been increasing their military presence in the South China Sea in recent months.

The resource rich sea lies within the territorial waters of several countries in South-east Asia.