TBILISI, Sept 17 (Reuters) - Georgia's parliament approved President Mikhail Saakashvili's plan to boost the army to 32,000 people from 28,000 on Monday, citing rising "threats from abroad".

The moves come amid tense ties with Moscow after Tbilisi said a Russian fighter jet dropped a missile on Georgia in August. Russia said Georgia fabricated the incident.

"It's necessary in order to protect our country from the barefaced aggression from a neighbouring country," Zurab Dekanoidze, the president's representative in parliament, said, submitting the document to parliament.

Dekanoidze said boosting the army's numbers was also necessary because Georgia had increased its military contingent in Iraq.

Georgia, a Caucasus nation, has drawn ire from Russia by forging close ties with the U.S. and plans to join NATO. Georgia boosted its military force in Iraq from 850 to 2,000 earlier this year.

But Georgian Defence Minister David Kezerashvili said last week the country would cut its troops in Iraq to less than a quarter of the current contingent by next June.

The defence ministry's budget will be boosted to 1.2 billion lari ($730 million) from 957 million lari ($566 million) set after a previous amendment in June. Georgia's initial defence spending forecast was earlier put at 513 million lari.

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