LA PAZ, Bolivia (Reuters) -- Bolivian President Evo Morales said that his government will significantly expand the legal area for growing coca, the raw material for cocaine, disregarding restrictions set out in a U.S.-sponsored law.

"It is impossible to have less than 12,000 hectares (29,700 acres) ... as a government we pledge to have less than 20,000 hectares (49,400 acres) of coca," Morales said during the presentation of his 2007 coca eradication plan in Chimore, some 370 miles (600 km) east of La Paz.

The eradication plan is negotiated with growers and Morales calls it a rationalization plan.

"It would be impossible to commit to something we're never going to meet," said the leftist leader and former coca farmer, who aims to push a plan sponsored by Venezuela to export health, hygiene and beauty products containing legal coca.

As set out in a 1988 law backed by Washington, the Yungas region is the only one allowed to produce coca -- on a maximum of 29,700 acres (12,000 hectares) -- for traditional uses such as chewing or for making tea to ward off hunger and altitude sickness.

A subsequent decree also allows small plots of coca to be grown in Chapare, where Washington funds eradication programs.

No one at the U.S. Embassy in La Paz was immediately available for comment on Morales' announced change.

The United States estimates that there are 64,200 acres (26,000 hectares) of coca crops in Bolivia.

Morales, who still heads the national confederation of coca farmers, has vowed to defend peasants who make a living by growing the plant used to make cocaine, although he also has promised to fight the drug trade.

Bolivia is the world's third-largest cocaine producer after Colombia and Peru while the United States is the biggest market for the drug.

Morales, Bolivia's first indigenous president, advocates the voluntary eradication of coca instead of the compulsory eradication promoted by Washington, which earlier this year accused Bolivia of "doing too little" to fight the illegal drug trade.

Morales said his negotiated eradication method has prevented the bloody clashes between security forces and coca growers, which were common in the past, while some 12,400 acres (5,000 hectares) of coca crops have been eradicated.

"Let's have a look at neighboring countries, where billions and billions of U.S. dollars are spent without any results ... (here) we've had results in terms of net reduction. It's not much but it's a step forward," he said.