* Shanahan meeting his Indonesian counterpart
* Ties limited due to rights abuses in the 1990s
* Pentagon says planning for training in initial stages (Adds details about training)
By Idrees Ali and Nilufar Rizki
JAKARTA, May 30 (Reuters) - Acting U.S. Defense Secretary Patrick Shanahan met his Indonesian counterpart on Thursday as the United States looks to improve ties with an Indonesian special forces unit that have been limited due to human rights abuses in the 1990s.
During a trip to Jakarta by Shanahan's predecessor, Jim Mattis, last year, Indonesia said it was hoping he could help ease American limitations on contacts.
The United States announced in 2010 that it had lifted its outright ban on U.S. military contacts with the Indonesian special forces unit, known as Kopassus, which was accused of rights abuses in East Timor as it prepared for independence.
But legal restrictions meant to ensure the U.S. military does not become entangled with rights abusers prevented contacts with Kopassus from advancing beyond preliminary levels, U.S. officials say.
Indonesia and five other Southeast Asian nations launched the "Our Eyes" intelligence pact last year aimed at combating Islamist militants and improving co-operation on security threats.
Indonesia, the world's largest Muslim-majority country, has in recent years struggled to contain a resurgence in home-grown radicalism inspired in part by the Middle Eastern militant group Islamic State.
The two sides said in a joint statement after the meeting between Shanahan and his Indonesian counterpart, Ryamizard Ryacudu, that the United States was looking to normalise relations with Kopassus and hold a joint exercise in 2020.
"Both ministries affirm support for the expansion in our army to army exercise next year, and by normalising the Army special forces relationship beginning in 2020 with a Joint Combined Exercise Training with KOPASSUS," the statement said.
Lieutenant Colonel Dave Eastburn, a Pentagon spokesman, said the planning for the training was still in the initial stages, but would likely be for four to six weeks and include approximately 150 participants.
"While planning is just starting, the initial concept includes topics such as crisis response, hostage rescue, and safeguarding human rights, among others," Eastburn said. He added that the training would be with conducted with Kopassus Unit 81.
The meeting comes amid increasing tensions between China and the United States.
Indonesia has clashed with China over fishing rights around the Natuna Islands detaining Chinese fishermen and expanding its military presence in the area in recent years.
In 2017, Indonesia renamed the northern reaches of its exclusive economic zone in the South China Sea the North Natuna Sea, a change seen as a significant act of resistance to China's territorial ambitions in the South China Sea.
Thursday's joint statement also said both ministries "support the possibility of increased information sharing and exchange of views on an assessment of regional threats by using ASEAN Our Eyes (AOE) as the platform for strategic information exchange among ASEAN Member States."
The two countries also discussed conducting underwater surveys to ensure that the wrecks of World War Two warships in Indonesian waters are left undisturbed. There have been reports of looting of sunken ships by marine salvagers.
"Both ministries discussed the importance of supporting the sanctity of remains entombed in vessels like the World War Two wreck, USS Houston, and of cooperation to identify U.S. remains in Indonesia," they said in the statement. (Writing by Ed Davies; Editing by Robert Birsel and Alison Williams)
Our Standards: The Thomson Reuters Trust Principles.