Indonesia is giving six airlines three months to improve safety or face suspension or closure.

An audit of 54 airlines revealed none of them made it into the first of three rating classes, indicating high safety, the director-general of civil aviation, Budhi Muliawan Suyitno, said.

Fifteen companies were placed in the lowest category and were considered to have met only minimal standards of safety. The national carrier, Garuda, made the second grade.

The audit was ordered by the Government to evaluate transport safety following two deadly recent air accidents.

An Adam Air Boeing 737 carrying carrying 102 people disappeared on January 1 on a flight from Surabaya, Java, to Manado, Sulawesi.

Wreckage from it was found on the ocean floor just off south-west Sulawesi several days later, but a salvage operation is yet to begin, following a dispute between Adam Air and the Government over who should pay for it.

On March 7 a Garuda Boeing 737 overshot the runway at Yogyakarta and burst into flames, killing 21 people, including five Australians.

Mr Suyitno said airlines in the third category would be given warnings to improve standards within three months.

"If there's no improvement within three months, there will be a suspension order, and if there's still no improvement they will be shut down," he said.

The airlines given three months to shape up are Adam Air, Kartika Airlines, Jatayu, Batavia, Trans Wisata Air and Dirgantara.

Mr Suyitno said the new airline category system, which is based on 20 safety criteria such as accident history and maintenance standards, was born of the need for a systematic and durable approach to passenger protection.

He replaced the previous air transport head this month amid pressure on the Transport Minister, Hatta Rajasa, for improvements after the Garuda disaster.

Air travel in Indonesia, a sprawling country of more than 17,000 islands, has grown substantially since liberalisation of the airline industry in 1999, which triggered price wars. There are fears safety has been compromised and doubts as to whether aviation infrastructure and personnel can cope.

There have also been two ferry disasters in recent months, killing hundreds of people, and railway accidents are common.