China will loan Malaysia two pandas in yet another gesture to strengthen bilateral ties between the two countries, Malaysia's Natural Resources and Environment Ministry said in a statement on Monday.

The deal was initiated by China Wildlife Conservation Association and the Malaysian government.

Under the agreement, the pandas would be on loan for 10 years to Malaysia to mark the 40 years of China-Malaysia diplomatic relations in 2014.

The ministry said the cooperation would allow Malaysia to conduct conservation research on the giant panda and the public to appreciate the biodiversity and learn about panda conservation undertaken by China.

The government would hold a nationwide contest to name the black and white Chinese bear while they are exhibited at a park in the federal administrative center, Putrajaya.

The ministry added that the close relationship between Malaysia and China that started during the tenure of current Malaysian prime minister's father Abdul Razak Hussein had spurred the country's economy and boost foreign investment.