Alix Kroeger: Decision reverses decline in military spending in the 90s

He set out the proposal as just the start of a six-year effort that could amount to a $100bn - the largest increase since the end of the Cold War.

Mr Clinton said the new money would help pay for the next generation of ships, planes and weapons systems.

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"We want our force to remain the best equipped in the world in the next century," President Clinton told his radio audience in the first presidential broadcast of the New Year.

The plans would also finance the biggest pay rise for the military since 1982, and allow the replacement of ageing equipment, barracks and family housing for the 1.4 million Americans on active duty.

Correspondents say some of the extra money will be spent on funding the American peace-keeping force in Bosnia.

"We want our Armed Forces to remain ready to deploy rapidly in any crisis, and that is what this effort will assure," said President Clinton.

Mr Clinton is expected to submit the proposal to Congress next month.

The president's initiative comes at a time when the US military is deployed in the Gulf and in Bosnia - a total of 250,000 soldiers outside the United States.

Three S-3 Vikings over the USS Abraham Lincoln - currently in the Gulf

Our defence correspondent says the Clinton administration's defence policy has come in for some strong criticism not just from the president's Republican opponents but also from within the armed forces own ranks.

Senior serving officers are reported to be worried about decreasing readiness levels, insufficient funds for training and shortages of spare parts.