SINGAPORE, Oct. 14 (Xinhua) -- The bid of Singapore Airlines and Virgin Australia to form an alliance has been give the principle go-ahead in Australia, Singapore media reported on Friday.

Singapore Airlines said the announcement was "welcome news to leisure and corporate travellers alike."

The proposed alliance will give Singapore Airlines customers easy access to Virgin Australia's domestic network of more than 30 destinations. The alliance was announced in June that would include a code-sharing agreement, meaning that the two carriers will sell seats on each other's services.

The partnership still awaits the approval from Singapore regulators, which is expected before the end of the year, the Straits Times said.

Both airlines said they would coordinate flight schedules so travellers can transfer seamlessly from one carrier to another. Reciprocal frequent flier benefits are also on the cards, as well as joint sales and marketing of routes.

Australian competition watchdog has asked interested parties including rival carriers for comments.

Australian flag carrier Qantas said it did not object to the tie-up. Citing the many challenges that face airlines, Qantas said that carriers based in different countries have developed cooperative arrangements to offer a wider route network and a more efficient range of services.

Facing intensifying competition and challenges, Singapore Airlines has recently announced plans to start a new low-cost airline that will operate in the long-haul market next year.