Australia's Foreign Minister Julie Bishop has announced that Australia will contribute more money to support Myanmar's peace process.
From the existing Aid budget, Ms Bishop says $24.5 million will go to boosting economic growth in the nation.
It includes $5 million for the World Bank to help modernise financial management systems. $9 million will go to support the peace process and $10 million for urgent humanitarian aid, to provide food, water and sanitation.
Ms Bishop says Australia was one of the first countries in the developed world to constructively engage with Myanmar.
Bishop addresses human rights on tour
Ms Bishop has ended a three-day tour to Myanmar, to strengthen ties with Myanmar's government.
During her tour, Ms Bishop raised human rights issues during talks with the president of Myanmar, Thein Sein.
She had a formal meeting with the president and the foreign minister, where they discussed trade and investment and defence cooperation.
Ms Bishop says she also raised human rights concerns, specifically the Myanmar government's "action plan" for the Rakhine state.
Myanmar's foreign minister confirmed he will sign up to the Colombo Plan so Australian university students will be able to study in Myanmar from next year.
During the visit, Ms Bishop also held a 45-minute meeting with opposition leader and Nobel laureate Aung San Suu Kyi.
Ms Suu Kyi is fighting for changes to Myanmar's constitution so she can run for the presidency during next year's election.
"We would like everybody's support with regard to amendments to the constitution, not just Australia," she said.
Ms Bishop's visit comes as clashes erupted between Muslims and Buddhists in the country's second largest city Mandalay.
Police intervened to stop a crowd of more than 500 Buddhist men, armed with bamboo sticks and iron rods, from attacking a group of Muslims.
Macquarie University Associate Professor of Economics Sean Turnell has advised the Australian government on Myanmar issues, and believes Ms Bishop's decision to meet with Rohingya representatives early in her tour will not send a strong enough message to the government to change its stance on the issue.
"I think the Australian government needs to be very loud and very clear that this is really unacceptable and it really puts in danger the entire reform program," he said.
This year Myanmar, also known as Burma, is taking on the role of chairing the Association of South East Asian Nations (ASEAN), an honour the former pariah state has never held before.
Humanitarian disaster unfolding in Rakhine state
Sectarian violence in Rakhine state has driven more than 100,000 people from their homes in the past six months.
Myint Thein, a Rohingya from Rakhine state, says his community of 400,000 is now living in a camp where each family is given a space of two square metres to live in.
He says people living in camps are not able to be treated in time when they get ill and about 50 refugees have died in the past two years, many of them pregnant women.
Another Rohingya man tells a similar story of living in a nearby camp.
Dr Turnell says resolving the Rohingya issue is crucial to Myanmar's reform.
"This whole Rohingya issue is a deeply serious one, and it really puts at risk the entire reform program," he said.
"I don't think the government in Myanmar has been loud and clear enough to really stop some of these ultra-nationalist, these anti-Muslim attacks that a really beginning to mushroom right across the country now."
Shunned by the majority Buddhist community, Rohingya Muslims are largely without health care.
Earlier this year many non-governmental organisations were forced out of western Myanmar including Doctors Without Borders and Malteser International.
Malteser's country coordinator Johannes Kaltenbach says the NGO was attacked in March for removing a Buddhist flag from its headquarters.
He says the group's 200 Rohingya patients are now left to fend for themselves.