The decision to increase the defence budget follows unusually short budget negotiations in the Nordic country that shares Europe's longest land border with Russia.

"The war in Europe has fundamentally changed our security environment," Defence Minister Antti Kaikkonen said in a statement.

"For this reason we have decided to allocate a significant budgetary increase to the defence forces," he added.

The additional funds, totalling 2.2 billion euros ($2.4 billion), would be spread out over four years, with 788 million euros added in 2023 and then 408 million euros a year until 2026.

With Russia's invasion of Ukraine, security has become a more urgent issue in Finland and reignited a debate about potential NATO membership in the country.

Traditionally most Finns have opposed joining the military alliance but recent polls have for the first time showed a majority in favour of membership.

Finland's President Sauli Niinisto has urged Finns to keep a cool head on the issue and called for the country to decide "without hesitation but carefully" on the issue.

Since the assault on Ukraine, Finnish leaders have held multiple meetings with their US and Nordic counterparts regarding Finnish defence and security.