Finance Minister Sri Mulyani Indrawati, who proposed the package to parliament Tuesday, said the plan offered a mix of government spending, tax breaks and incentives to boost economic output and create jobs.

'The stimulus is all about reducing fees that have been imposed, easing the burden of doing business and providing additional budget expenditure,' Ms Sri said.

The parliament has yet to approve the stimulus package.

Indonesia's government has pared back its 2009 growth forecasts to between 4.5 and 5.5 per cent from an earlier 6.2 per cent due to declining commodity exports and lower foreign investment.

The government also raised its projected budget deficit to 2.5 per cent of gross domestic product from an earlier one per cent, with declining revenue leaving a bigger hole in state coffers. -- AFP