Jakarta - Indonesian President Susilo Bambang Yudhoyono warned Friday that terrorism remained a threat to the country despite various achievements in combating such attacks.

In a state of the nation address ahead the August 17 independence day, Yudhoyono said efforts to thwart and overcome transnational crime and terrorism have shown "encouraging progress."

"The security apparatus has managed to arrest, prosecute and sentence the perpetrators," Yudhoyono said, adding that police discovered a cache of home-made explosives and bombs in South Sumatra's capital of Palembang in July.

"Various achievements are very heartening to all of us, but we must continue to heighten our vigilance," he said.

Jakarta - Indonesian President Susilo Bambang Yudhoyono unveiled Friday a draft state budget for the fiscal year 2009, forecasting economic growth of 6.2 per cent.

In a state of the nation address ahead the August 17 independence day, Yudhoyono said the government's revenues and grants in the 2009 draft state budget would amount to 1,022.6 trillion rupiah (112.37 billion dollars), while the total expenditures were forecast at 1,222.2 trillion rupiah (134.3 billion dollars).

Yudhoyono said the 2009 budget marked a 14.3-per-cent increase compared with the 2008 revised budget, predicting a budget deficit of 1.9 per cent of GDP, which will be mostly funded from domestic sources - mainly derived from the issuance of government bonds.

Jakarta, Jan.