"A group of soldiers of the caliphate in Indonesia targeted a gathering from the crusader alliance that fights the Islamic State in Jakarta through planting several explosive devices that went off as four of the soldiers attacked with light weapons and explosive belts," the group said in a statement.

Five terrorists executed what the police said were Paris-style attacks as they detonated explosives and shot at people in a crowded area of Jakarta close to the presidential palace, UN offices and malls.

The attack left two dead and at least 20 injured.

Police said the five attackers included three suicide bombers who initially targeted a Starbucks near a popular shopping mall.

After the first blast, armed men reportedly took two men hostage. The police said one man was wounded and escaped but the second man was shot dead. Another man who tried to help the two was also killed.

The attackers allegedly entered the city on motorcycles, armed with guns and explosives. After the blasts, hundreds of policemen and armoured tanks moved into the area.

"From what we see today, this group is following the pattern of the Paris attacks," National police spokesperson Anton Charliyan was quoted by AFP as saying.

ISIS gunmen killed 130 people in a series of coordinated attacks in Paris in November.

This is the first major attack in Jakarta since the twin bombings in 2009.