The changes, like all foreign military deployments, still need to be approved by parliament.
What did Germany say about the change in deployment?
"The upper limit was increased by 300. This is intended to compensate for capacities previously undertaken by French forces," said government spokeswoman Christiane Hoffmann.
Hoffmann added that the Mali mandate had been extended to May 31, 2023.
The announcement comes as France is pulling its forces out of Mali after relations with the country's ruling junta broke down.
French forces in Mali were not part of MINUSMA, but played an important part supporting UN troops in the country, especially with air power.
Hoffmann said that training and support previously provided to Mali would be offered to Niger's military in the future, citing a "changed situation" in the Sahel.
According to Hoffmann, Germany is also concerned that Malian forces receiving EU training could cooperate with Russian mercenaries operating in the country. German Defense Minister Christine Lambrecht warned last week that Malian forces could "commit cruel violations of human rights" alongside Russian mercenaries.
What is the goal of the deployments?
Mali has been fighting an Islamist insurgency over the past decade.
France dispatched troops in 2013 to help Mali put down the insurgency. The insurgency then spread to nearby Niger and Burkina Faso.
France is withdrawing its deployment from Mali after relations between the two countries soured following the ouster of then-President Ibrahim Boubacar Keita in August 2020. The transition back towards civilian government, or lack thereof, was a particular bone of contention. France has also criticized the presence of what it calls Russian mercenaries in Mali, which Mali's junta says are military instructors.
The UN Security Council is set to determine whether to renew the mandate of MINUSMA next month. Last week, UN chief Antonio Guterres said that MINUSMA could be replaced by an African Union force.