The massive move will cost $33 billion and the construction is set to begin next year.
Indonesian authorities warned of "extreme weather and high waves" around the erupting Krakatau volcano, urging people to stay away from the coast already devastated by a tsunami that killed at least 430 people and left around 21,000 people homeless.
The latest death toll from the volcano-triggered disaster in Indonesia stands at 429, with 1,485 people injured and another 154 missing.
A bus carrying more than 40 people hit a motorbike while heading down a hill and rolled over multiple times in Java island, killing at least 27 and injuring 16 others.
About 30 people, including farmers harvesting ginger, were feared to be buried by a landslide triggered by heavy rain on Indonesia's Java island on Saturday.
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