JAKARTA -- Indonesia is set to expand its budget for infrastructure outlays in fiscal 2018, with government proposals outlining a jump of as much as 17%, as part of a plan to attract more businesses to the Southeast Asian nation.

The government aims to eliminate obstacles such as a lack of roads and electricity that have kept companies from entering the Indonesian market.

According to local media outlets, up to 455 trillion rupiah ($34.2 billion) in infrastructure investments are being considered for fiscal 2018. The government hopes that these efforts will help it achieve gross domestic product growth of 5.4% to 6.1% that year, a significant jump from the 5% logged last year.

Indonesia has grown steadily, underpinned by a population of about 250 million. But slow progress in the country's manufacturing sector, which is the key to increasing incomes and consumer spending, has prevented it from accelerating its economic growth.

An expected increase in tax revenue will support the country's efforts to step up infrastructure development. The government's tax amnesty scheme conducted from July through March led 960,000 people, mostly affluent citizens, to declare their hidden assets. As a result of the scheme, the country's tax base is expected to broaden significantly. Currently just 4% of the population pays taxes annually.

Some officials say the government should aim for about 6% GDP growth in fiscal 2018 to shore up support for the Joko Widodo administration ahead of presidential elections in 2019. The plan to boost infrastructure spending is set to be included in the fiscal 2018 budget proposal due in August.

(Nikkei)