Indonesia's government will offer incentives for public transport operators to keep their fares down in an effort to quell widespread protests following major fuel price hikes, a report said.

Transport Minister Hatta Rajasa said the package of measures would include an exemption from import duties on commercial passenger vehicles while a crackdown would be launched on corruption and crime plaguing the industry.

"If we can curb extortion by unscrupulous officials and thugs and make the operation more efficient, the operators will not raise their fees as high," she said, according to the Jakarta Post newspaper.

Indonesia last week raised fuel prices by an average of 29 percent sparking a wave of protests by public transport operators.

Although officials have said that fuel prices account for a small percentage of the operational costs of public transport, operators have unilaterally raised fares, sometimes by up to 50 percent.

The incentive "has been created so that drivers and ticketers do not raise their fares by more than 10 percent because this will spark public protests," Rajasa said.

Analysts say that Indonesia's inflation rate will surge in March following the fuel price hike, with transportation prices likely to lead the way.