JAKARTA: Smarting from the loss of two islands to Malaysia and a renewed border dispute with its neighbour, Indonesia today said it plans to build 25 lighthouses to assert its control of outlying islands.

"A lighthouse is not only for guiding sea navigation but it is also a mark of Indonesia's sovereignty in those particular waters," Transportation Minister Hatta Rajasa told journalists at the palace.

He said the new lighthouses would be built over the next year in outermost islands or reefs in border areas with Malaysia, Singapore, the Philippines and East Timor and would cost about 50 billion rupiah (US$5.36 million).

Indonesia and Malaysia came close to blows earlier this month when Kuala Lumpur awarded an oil concession in a disputed maritime area. Both countries dispatched warships to the region but have since agreed to hold talks.

The negotiations follow a 2002 international court of arbitration ruling that gave two islands in the region off Sabah to Malaysia.