The Defense Agency plans to set up a coast guard unit separate from the Maritime Safety Agency that would use high-speed patrol boats, according to papers submitted to a Liberal Democratic Party meeting Friday.

The plan appears to be a reaction to an incident in March in which two suspicious fishing trawlers spotted in Japanese waters eluded the Maritime Self-Defense Force's chase vessels as they fled to North Korea.

Details of the new unit are included in the agency's draft budget request for fiscal 2000. The request totals 4.99 trillion yen, up 1.6 percent from the current fiscal year. Of the total, 31 billion yen is earmarked for countermeasures against rogue vessels.

The plan envisions a a 60-member coast guard within the MSDF that sources say would likely be deployed to Etajima, Hiroshima Prefecture, by early 2001.

Funding would also be allocated to the construction of two missile-equipped patrol boats that could reach speeds of up to 75 kph and to the purchase of machineguns and infrared night scopes to be used on MSDF destroyers and patrol helicopters.

The request also includes glimpses of how the agency hopes to beef up other areas of Japan's defenses.

In an attempt to counter any threat of biological and chemical weapons, the agency will establish a research unit at the Ground Self-Defense Force's Camp Asaka in Saitama Prefecture. With a 2.4 billion yen budget, the army unit will engage in studies on antinuclear, biological and chemical warfare as well as medical issues.

The agency also hopes to secure 2.7 billion yen to prepare for the formation of an antiguerrilla warfare unit in the near future. Starting next fiscal year, the GSDF will build training facilities and introduce indoor guerrilla warfare simulators using virtual-reality technology.

In response to Japan's new logistic support for U.S. forces in emergencies near Japan, approved by the Diet in May, the MSDF will spend 157 million yen in fiscal 2000 for a 13,500-ton supply vessel to be completed in 2003 at a total cost of 52 billion yen.

Bending to pressure from Chief Cabinet Secretary Hiromu Nonaka, the agency decided to forgo a planned request to procure aerial refueling aircraft in this draft budget request. Nonaka fears the issue could affect the LDP's coalition talks with New Komeito.

The acquisition of refueling planes would extend the range of Japan's fighter jets, which would enable Japan to stage airstrikes on other countries. Critics point out that this possibility runs counter to national policy of limiting military action to self-defense.

In Friday's LDP panel on national security issues, lawmakers urged Defense Agency officials to include funding for refueling aircraft in additional allocation requests for the fiscal 2000 budget, which will be compiled at the end of the year.

Currently, 24 countries possess these planes, including China, Singapore, Indonesia and Malaysia, according to the Defense Agency.

The agency's draft budget request also includes:

* 2.1 billion yen for a joint research project with the U.S. on the Theater Missile Defense system;

* 275 billion yen for U.S. service members and their families stationed in Japan, the annual "sympathy" outlay covering the costs of housing and other utilities at U.S. installations in Japan as well as salaries of Japanese employees working there. The amount is roughly the same as in the current fiscal year.