SUBANG JAYA (The Star/Asia News Network, AFP) - Malaysia's Proton Holdings Bhd has signed a memorandum of understanding (MoU) to develop and manufacture an Indonesian national car, one of the accords reached during Indonesia President Joko Widodo's first bilateral visit to Malaysia.

The MoU was signed by Proton and its Indonesian partner, PT Adiperkasa Citra Lestari, at a ceremony at the Proton Centre of Exellence here.

The signing of the MoU was witnessed by Prime Minister Najib Tun Razak, Proton chairman Mahathir Mohamad and Widodo, who visited a factory run by Proton on Friday, the second day of his two-day visit.

Najib last year revived a decades-old proposal for a jointly produced "Asean car". Widodo has expressed interest in the idea, which would seek to capitalise on a booming regional car market.

The proposal is considered to be very preliminary and it remains unclear whether it would gain traction.