Jakarta – A senior US defense official on Wednesday expressed optimism that Washington would restore full military cooperation with Indonesia, citing the country's moves towards democracy.

Cooperation between their armed forces in the aftermath of last year's tsunami and access given to FBI agents investigating the 2001 killings of two US citizens in Papua province were also "clear indicators" of Indonesia's recent progress, said Brigadier General John Allen.

"They are very clear indicators of the directions in which we can go together as two nations," said Allen, a director for Asian and Pacific Affairs of the US defense department.

"We think that we can work with the Congress to continue to extend and facilitate this relationship," he said in Jakarta at the end of a two-day US-Indonesia security dialogue.

Washington imposed restrictions on contacts after the Indonesian military massacred pro-independence protesters in East Timor in November 1991.

The restrictions were further tightened in 1999 after militias backed by the Indonesian army killed about 1,400 people before and after East Timor voted for independence from Jakarta.

The US is keen to restore full military ties with the world's largest Muslim-populated nation to assist its global "war on terror".

Washington eased an embargo on the supply of US military hardware to help boost relief efforts in Indonesia's Aceh province, the region hardest hit by the December 2004 tsunami.

In February the United States decided to resume training members of the Indonesian armed forces.

Allen said Washington was "very encouraged" by the formation of a joint commission of truth and friendship by East Timor and Indonesia as a means of reconciliation.

"So as we continue in the process of accountability with regard to Timor, as evidenced by the commission of truth and friendship... we are very optimistic with the future," he said.