Indonesia Seeks to Boost Arms Industry

By webadmin on 03:01 pm Mar 24, 2012
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Zakir Hussain – Straits Times

The Indonesian military’s shopping list in recent months has included Sukhoi fighter jets and Leopard main battle tanks, but what the country’s defense officials are most excited about after years of belt-tightening is not the hardware.

Rather, it is the pledges that the armed forces have secured for the transfer of military technology. Officials hope to use this know-how to grow a domestic defense manufacturing industry at a time when the economy is booming.

Indonesia is already working with South Korea to jointly make jet fighters and 1,400-ton submarines. It hopes to produce C-705 anti-ship missiles with a range of 140km with Chinese help, and officials want to do more.

A more robust defense industry, Indonesian Armed Forces commander Agus Suhartono told a defence conference on Friday, will not only enhance the country’s security and stability, but also improve public welfare.

“It will create new job opportunities,” he said.

The country’s major local armaments makers — arms and vehicle manufacturer Pindad, aircraft manufacturer Dirgantara and shipbuilder PAL Indonesia — also produce equipment for civilian use, but Adm. Suhartono said raising their export capability will help boost national income.

“Competition in the international defense market is fierce, and it is generally difficult to navigate for newcomers,” he added, calling for greater cooperation between defense industries in the region.

Local manufacturers have had some successes. Earlier this month, Dirgantara delivered the fourth CN-235 maritime patrol aircraft to the Korean Coast Guard.

Indonesia has also been conscious of the need to allay concerns over its buildup, even though this year’s defence budget of $7 billion — a 28 per cent increase from last year — is under 1 per cent of gross domestic product and pales in comparison to China’s US$106 billion.

President Susilo Bambang Yudhoyono, a former army general, said on Wednesday: “These growing defence expenditures should be seen in the context of normal process of military modernisation, and do not constitute an arms race.”

China has been particularly supportive of Indonesia’s efforts to revitalise its defence industry, but defence industry policy committee spokesman Silmy Karim said countries like South Korea and Turkey were keen to do more with Indonesia in this field.

Last December, Indonesia and South Korea signed a $1 billion deal for three submarines. Indonesians will be involved in building the first two in Busan, so as to be ready to build the third in Surabaya.

On a visit to Beijing last month, Defence Minister Purnomo Yusgiantoro sought assistance for monitoring equipment needed to navigate the archipelago’s sea lanes, and visited defense, including missile production facilities.

Chinese ambassador to Indonesia Liu Jianchao has told reporters he understood that adequate military might was necessary to safeguard the sovereignty and integrity of Indonesia, and would also make the region more stable.

Parahyangan Catholic University international relations lecturer Mira Permatasari said: “Vested interests in developed countries seem reluctant to share know-how, but countries in the region appear to be more supportive.”

Defense ties, however, continue to be strong all-round. Last November, the United States said it would supply Indonesia with 24 refurbished F-16 fighters. Australia will also grant Indonesia four C-130 Hercules aircraft for disaster relief needs.

But the defense build-up has not been without controversy at home.

Several MPs have been critical of recent and planned arms purchases, although observers say this is because these do not involve brokers who mark up prices and split the gains.

These include the purchase of six Sukhoi jet fighters from Russia last year, and the planned purchase of 100 second- hand Leopard main battle tanks from the Netherlands, and if Dutch lawmakers object, from Germany.

Others have said the army could have tapped on Pindad, which produces a range of material from assault rifles to armored personnel carriers (APCs).

But officials say getting such equipment off the shelf will shorten the learning curve and enable Pindad to do more in the long run.

Just this month, the Defence Ministry and army signed 1.3 trillion rupiah (S$178 million) worth of contracts with local makers, including for 31 Anoa APCs.

Purnomo said: “We want to produce as many weapons systems locally as is possible.”

The Indonesian military’s orders last year included:

Three submarines and 16 KAI T-50 Golden Eagle advanced trainers from South Korea

Six Sukhoi fighter jets

Nine NC-295 medium transport planes from Spain

Eight Embraer Super Tucano counter-insurgency aircraft from Brazil

On its shopping list this year are:

Army

Leopard 2A6 main battle tanks from the Netherlands and/or Germany

Multiple launch rocket systems 155mm Howitzers

Assault and transport helicopters

Armored personnel carriers

Navy

Fast patrol boats

Guided-missile destroyer

Hydro-oceanography vessel

Various auxiliary vessels, including fuel and landing ship tank

Anti-submarine warfare helicopter

Air force

Anti-aircraft missiles

EC-725 Cougar helicopter

24 units of F-16 (to be retrofitted)

Four units of C-130H heavy transport aircraft, a gift from Australia (to be retrofitted)