Japan and Indonesia will strengthen their security cooperation and begin talks on transfers of defence equipment, their foreign and defence ministers said on Thursday, as China's maritime expansion leads its neighbors to forge closer ties.

China's reclamation work and building of airfields on artificial islands in the Spratly archipelago have alarmed the region and raised concerns that Beijing is extending its military reach deep into maritime Southeast Asia.

Thursday's agreement between Japan and Indonesia comes days after Tokyo reached an agreement with India on the legal framework for transfers of defence equipment and technology.

"As the security environment in the region gets tougher, we've confirmed in today's meeting that we will fortify cooperation with Indonesia, a core ASEAN member, in the fields of security and defence," Japanese Foreign Minister Fumio Kishida said.

Kishida made the comment at a joint news conference after a meeting of the two nations's foreign and defence ministers. Indonesia is the largest member of the Association of Southeast Asian Nations in terms of economy and population.

China has overlapping claims with Vietnam, the Philippines, Malaysia, Taiwan and Brunei in the South China Sea, through which $5 trillion in sea-borne trade passes every year.

For its part, Japan has been mired in a territorial spat with China over a group of tiny, uninhabited islets in the East China Sea.

Japan and Indonesia agreed at Thursday's meeting that the South China Sea issue should be resolved through dialogue.

Indonesian Defence Minister Ryamizard Ryacudu said he intended to work with China to improve the situation.

"I believe China's stance is not as hard-line as before. We intend to proceed with talks with countries including China on such matters as joint training and joint patrols in the South China Sea," the minister said through an interpreter.