Indonesia on major defense spending spree

Indonesia's recent procurement plans spotlight a growing arms race in the Indo-Pacific region.

Dian Septiari

Dian Septiari

The Jakarta Post


February 14, 2022

JAKARTA – Indonesia made major purchase announcements of fighter jets from United States and French manufacturers this week in the biggest military buying spree in recent years, raising concerns over government spending as the nation rations funds to recover from COVID-19.

The procurement plans spotlight a growing arms race in the Indo-Pacific region, following the surprise announcement last year of a security partnership between the US, Australia and the United Kingdom.

The Defense Security Cooperation Agency (DSCA), an agency under the US Department of Defense, announced the possible sale of F-15ID aircraft and related equipment to Indonesia in a deal valued at up to US$13.9 billion on Thursday, just hours after Indonesia and France signed a purchase agreement for the first six of 42 Rafale fighter jets as part of a contract worth of $8.1 billion.

“The proposed sale will improve Indonesia’s capability to meet current and future threats by enabling it to provide increased deterrence and air defense coverage across a very complex air and maritime domain, the DSCA said in a statement published on Thursday.

Boeing is the principal contractor for the F-15 jets, the Pentagon’s cooperation agency said in a statement. The package would include 36 jets, spare engines, radar, night vision goggles training and technical support.

The DSCA notified the US Congress of the possible sale on Thursday. Despite approval by the State Department, the notification does not indicate that a binding contract has been signed or that negotiations have concluded.

An Indonesian Defense Ministry spokesperson confirmed the latest update from Washington, but added that the purchase was still in the “exploratory” stage.

Defense Minister Prabowo Subianto told lawmakers early last year that his office was interested in procuring both Rafale jets from France and F-15s from the US.

Military analyst Connie Rahakundini Bakrie said that while the purchase of the Rafales from France has been finalized, Prabowo still needs to explain to the public about the high cost of procuring advanced military equipment at this time.

She said the ministry owed it to the people to explain how the government would be paying for up to 78 new fighter jets from France and the US.

“Prabowo must explain why he chose these jet planes, what the interoperability will be like, as well as what maintenance, repair and operational components must be built around them, alongside the logistics system. Shopping is easy, and even though this will be paid for with foreign loans, it is still coming out of taxpayers’ money,” she said.

In the draft 2022 state budget, the Defense Ministry was granted US$9.3 billion, which will be used for its defense equipment modernization program ($3 billion), as well as military personnel expenses and welfare ($840 million).

President Joko “Jokowi” Widodo has also signed Presidential Regulation No. 85/2021 on the 2022 government work plan (RKP), which aims to achieve 85 percent of the Minimum Essential Force (MEF) plan by 2022, supported by a $2.06 billion budget for defense equipment procurement and industry.

Meanwhile, the Finance Ministry has also granted a determination of source of funds (PSP) amounting to $5.8 billion for defense procurement for 2021.

While Indonesia’s defense spending has increased significantly in the last few years, the portion of defense budget to gross domestic product has remained stagnant at 0.7 to 0.8 percent in the last 15 years, argued Andi Widjajanto, senior analyst in political security at Laboratorium Indonesia 2045.

“When Prabowo last year announced his strategic plans until 2044 to cover 20 years of our defense modernization, the proportion of our defense budget to our GDP was actually still maintained at 0.8 percent,” he said at a webinar hosted by the Foreign Policy Community of Indonesia on Thursday.

As such, he said Indonesia was aiming to maintain its current force and modernize the obsolete weapons systems, but Indonesia will not have any significant breakthrough in its posture.

“Arms maintenance will still be the main focus of the Indonesian Defense Ministry until 2040,” he said.

He noted that the government’s new strategic plan for defense modernization started in 2006 under then-president Susilo Bambang Yudhoyono. The current administration has to complete the third phase of its 2024 strategic plan, after which officials could reevaluate its strategic plan to ensure continuation until 2040.

“But it is still not decided by our government. We still have to wait to see whether or not in the next six months Jokowi and Prabowo will come up with a new strategic plan for the next 20 years,” he said.

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