The Biden administration has approved a $500 million arms sale to the island, as it ramps up military assistance to the island despite fervent objections from China.

The US decision coincided with Taipei announcing on Thursday that it will spend an extra $2.97 billion to buy weapons next year, including fighter jets to bolster its defences.

About half of the additional budget would be used to purchase fighter jets, and the remainder will go into bolstering naval defences, the government's statistics department said after a cabinet meeting to discuss the budget.

The budget will have to be approved by parliament, where Taiwan's leader Tsai Ing-wen's Democratic Progressive Party has a majority. Defence spending for next year will amount to 2.5 percent of Taiwan's GDP.

Tsai has overseen a military modernisation programme to make Taiwan's armed forces better able to face China, including upgrading its fleet of F-16 fighter jets and developing its own submarines.

Earlier, the US State Department said that it had signed off on the sale of infrared search tracking systems along with related equipment for advanced F-16 fighter jets to Taiwan.

The sale includes the infrared systems as well as test support and equipment, computer software and spare parts, it said.

Although the deal is modest in comparison to previous weapons sales, the move is likely to draw fierce criticism from Beijing, which regards self-governing Taiwan as a renegade province and refuses to rule out the use of force to reunify it with the mainland.

“This proposed sale serves US national, economic, and security interests by supporting the recipient’s continuing efforts to modernise its armed forces and to maintain a credible defensive capability,” the State Department said in a statement.

"The proposed sale will improve the recipient’s capability to meet current and future threats by contributing to the recipient’s abilities to defend its airspace, provide regional security, and increase interoperability with the United States through its F-16 program," it said.

On Wednesday, Tsai also renewed a pledge to strengthen Taiwan’s self-defence as she visited a war memorial from the last time Taiwan and China battled.

Tsai, visited the outlying islands of Kinmen where the conflict was fought 65 years ago, commemorated those who died.

In recent years, China has stepped up its military activity in the waters and skies around Taiwan, sending fighter jets and navy vessels near the island or to encircle it.