Giving Changi Airport a third runway is proving more challenging than expected.

Speaking in Parliament on Tuesday, Transport Minister Lui Tuck Yew said the soil condition at the site is poor.

"Land preparation will take a significant amount of time, as we have found out from recently-completed extensive tests that the soil condition on site is very much more poorer than expected."

Based on current plans, the government expects all three runways - the two existing ones and a third landing and take-off strip - to be operational around the early 2020s.

The third runway, currently used for military flights, is located on a piece of reclaimed land currently separated from the existing airport by Changi Coast Road.

Apart from runway capacity, Changi is also adding capacity to handle more passengers.

The airport, which handled 53.7 million passengers last year, expects to grow by about 4 to 6 per cent for the rest of the decade.

While some rival airports are growing more quickly, Changi cannot expect to grow at those rates, Mr Lui said.

"If we grow at 18 per cent each year like Bangkok and Kuala Lumpur, we will need to double airport capacity every four to five years," he said.

This is not sustainable given Singapore's land and manpower constraints.

On air traffic matters, Mr Lui said Singapore will continue to pursue a liberal policy which benefits Changi as well as passengers and airlines.

Since Singapore and Indonesia expanded air ties last year, there has been a 40 per cent jump in the number of flights between the two countries, he said.