State Department spokesman Sean McCormack said Washington planned "to provide assistance for specific military programs and units that will help modernize the Indonesian military."

He said resumption of Foreign Military Financing, suspended with other aid over human rights and other concerns, would help anti-terrorism efforts, maritime security and disaster relief.

McCormack did not give any further details and officials said no dollar amount had yet been determined for the FMF program, which provides outright grants for the purchase of materiel.

Earlier this year US Secretary of State Condoleezza Rice moved to renew military ties with the world's most populous Muslim nation, which helps guard strategic Asian sea lanes.

"It continues the process of military re-engagement with Indonesia that included the secretary's decision to resume International Military Education and Training (IMET) in February, and her decision to resume non-lethal Foreign Military Sales (FMS) in May," McCormack said.

US President George W. Bush and his Indonesian counterpart Susilo Bambang Yudhoyono at a White House summit in May decided to work toward closer defense relations.

However, the East Timor and Indonesia Action Network (ETAN) said that the State Department had subverted congressional human rights conditions placed on the resumption of military aid.

"This is a profoundly disappointing and sad day for human rights protections everywhere but especially in Indonesia, Timor-Leste, and the US," the group said in a statement.

"Two weeks ago, Congress sent a clear message to the Indonesian government and security forces that it expected real improvements in military reform, human rights protections and accountability for crimes against humanity and other serious crimes before FMF could be provided and lethal equipment exported to Indonesia.

"Secretary Rice has completely undermined that message and undermined congressional intent by doing so.

"The State Department's action is simply a transparent abuse of discretion granted to the executive by Congress," said ETAN, which advocates democracy, justice and human rights for East Timor and Indonesia.

US military dealings with Indonesia have been restricted since 1991 when Jakarta's forces launched a bloody crackdown on pro-independence protesters in East Timor. Sanctions were tightened after a new wave of violence there in

The United States had also made it clear that full normalization of military relations was contingent on the Indonesian authorities' efforts to solve the killing of two American teachers in 2002.

But in January, Washington allowed commercial sales of nonlethal defense items to Indonesia, particularly spare parts for transport planes after a tsunami hit in December 2004.

Washington restored IMET and around the May lifted a ban on government sale of non-lethal defense equipment.

McCormack said Tuesday Americans attached "the utmost importance" to their ties to Indonesia and the decision on foreign military financing was made "in the national security interests of the United States."

He said Jakarta had "made significant progress in advancing its democratic institutions and practices in a relatively short time."

But he added, "The US remains committed to pressing for accountability for past human rights abuses, and US assistance will continue to be guided by Indonesia's progress on democratic reform and accountability."

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