Indonesian cement sales was expected to expand by 16 percent to 26 million tons during the first half of this year on yearly basis, driven by the realization of infrastructure projects and the residential housing boom, the Jakarta Post said here on Tuesday.

"As of May, demand had already risen by 16 percent as infrastructure projects continue. A more favorable credit interest rate also encouraged people to build houses, which in turn fueled the demand for cement," Widodo Santoso, the newly appointed chairman of the Indonesian Cement Association (ASI) said in Jakarta on Monday.

A number of infrastructure projects under the master plan for economic acceleration and expansion, including roads, bridges and ports, are being realized.

Local banks have also cut their lending rates in line with the move by the central bank, which several times has slashed its benchmark rate since the end of last year, with the current rate standing at 5.75 percent.

Boosted by the positive outlook in sales during this period, the full year's sales would likely reach 54 million tons, up around 12 percent from last year, Widodo added.

This would be higher than expected as previously, when the association had predicted that cement sales would grow moderately by 6 percent this year to 49.82 million tons, as it had already booked record-high growth of 17.5 percent to 47 million tons last year.

"We're still facing a challenge from the impact of the recession in Europe. But, last year we still recorded stable growth and, so far this year, we've seen robust growth in sales," he said.

The nation's cement consumption per capita was 200 kg last year and still leaves enormous room for future growth along with the country's economic growth.

Indonesia's domestic cement consumption could break 55 million tons by 2015 and exceed 100 million tons in 2020, the Industry Ministry has estimated. Having anticipated the surge in cement demand, domestic cement manufacturers are expanding their production capacities from 56.82 million tons in 2011 to 80.39 million tons by 2015.