n has passed a $157bn (£99.3bn) additional budget, to be partly raised by issuing new government bonds, to pay for the bulk of rebuilding infrastructure shattered by the earthquake in March.
Its parliament hopes that the spending will also help sustain the Japanese economic recovery as the yen's strength, a global slowdown and contagion from the Eurozone debt crisis create obstacles in its path.
The 12.1 trillion yen budget earmarks 9.2 trillion yen for reconstruction spending, including 500bn yen for subsidies to encourage firms hit by the strength of the currency not to move factories and jobs outside Japan.
With public debt twice the size of Japan's $5 trillion economy, the government faces a balancing act to pay for the nation's biggest reconstruction effort since the years following World War Two without choking a fragile economic recovery.
Total spending of 19 trillion yen is planned over the next five years to rebuild northeast coastal areas devastated by the March 11 disaster, including 6 trillion yen already approved by parliament in two earlier extra budgets for the year to March.
From the third extra budget, the government plans to spend 245 billion yen on removing and disposing of soil contaminated by radiation leaks from the Fukushima Daiichi nuclear plant, whose reactors went into meltdown after the magnitude 9.0 quake and subsequent tsunami wrecked their cooling systems.
The extra budget will also enable the government to give a 15 trillion yen boost to its war chest for market intervention to curb the yen, with the borrowing limit to finance such intervention raised by changes in regulations on the state budget.
The bulk of the third extra budget will be funded by reconstruction bonds worth 11.55 trillion yen, to be repaid over 25 years through tax hikes.