Many people on the web can't find a solution to make the Arduino-CLI look for their custom libraries in a specific location for each of their projects.

I propose an option to have the extension look for a local arduino-cli.yaml file at the root of the project in order to be able to define these paths (and also further customize the behavior of the Arduino-CLI according to each project).

For reference, here is the list of possibilities offered by this configuration file: https://arduino.github.io/arduino-cli/latest/configuration/

Background:

Since the loss of compatibility with the Arduino IDE with version 2 and the mandatory use of the Arduino-CLI, many people have the problem that they do not know how to include their custom libraries anymore:
microsoft#1653 (comment)

It used to be possible to place an arduino-cli.yaml file at the root of the project:
microsoft#1614 (comment)
https://arduino.github.io/arduino-cli/0.22/configuration/#locations

Unfortunately, for security reasons, the latest versions of the Arduino-CLI no longer support the use of a local file.
arduino/arduino-cli#758
https://arduino.github.io/arduino-cli/1.1/configuration/#locations
Since February 2023, only the use of environment variables and the --config-file option are supported.

The only viable solution is to add an arduino-cli.yaml file in the "Arduino15" directory on your operating system. However, there remains a problem: the paths declared in this way are global, a certain number of users are looking for a way to be able to choose the libraries to use depending on their project.
#50 (comment)

Since VSCode does not support environment variables in this context, the only solution is to modify the Arduino extension for VSCode to use the --config-file parameter of the Arduino-CLI.

So I added an option for the extension to fetch a local arduino-cli.yaml at the root of the project using the config-file parameter, thus solving the problem.