BRISBANE - Singapore companies have been invited to participate in infrastructure projects in Queensland, Australia's second-largest state.

Prime Minister Lee Hsien Loong told reporters on Sunday that Queensland Premier Campbell Newman has plans to divest or lease out some state-owned assets, such as ports and power infrastructure.

Mr Newman welcomed Singapore companies to "come and invest and take up these projects", PM Lee said after a bilateral meeting with Mr Newman on the sidelines of the Group of 20 (G-20) summit.

"I said we'd be happy to look at them because we've got good relations with Australia," he added.

Singapore has a free trade agreement with Australia and both countries are in the midst of concluding a strategic partnership agreement that is due to be signed next year.

As such, "businessmen know that on both sides the mood is friendly and they can proceed with confidence", PM Lee said.

During their meeting, he also thanked Mr Newman for hosting Singapore's troops in exercises held in Queensland, such as the recent seven-day Exercise Trident conducted earlier this month.

The two leaders also affirmed the close ties between Queensland and Singapore especially in the areas of defence, education and a wide range of economic activities, the Prime Minister's Office (PMO) said in a statement after the meeting.

Mr Newman further expressed interest in building on bilateral exchanges of people, especially under the new Colombo Plan in which Australian students can study in Asian countries including Singapore, the PMO added.