Indonesia cleared to source foreign loans for AEW&C aircraft programme

Saab's AEW&C offering, which incorporates the Saab 2000 Erieye system. Indonesia has obtained approval to seek foreign loans for its AEW&C programme and is considering the Erieye system as one of its candidates. (Saab)

The Indonesian Ministry of Finance (MoF) has approved plans for the country to acquire two new airborne early warning and control (AEW&C) aircraft, with loans sourced from a foreign lender.

The approval means that the Indonesian Ministry of Defence (MoD) can now formally begin the process of evaluating suitable aircraft types and sources for a foreign lender to fund the programme.

The Indonesian Air Force (Tentara Nasional Indonesia Angkatan Udara: TNI-AU) is currently not equipped with any form of AEW&C capabilities.

Documents provided to Janes indicate that the ceiling approved for the loan programme is USD800 million, and it should cover the delivery of two airframes, together with their associated components, service equipment, and training packages.

The AEW&C aircraft procurement is in addition to the list of 16 programmes for the year, for which permission to take on foreign loans has been granted by the MoF, provided the formal contracts are signed with the MoD by 31 December 2023.

However, for the AEW&C programme, the MoD has a lengthier timeline and contract, for it needs to be signed by 31 December 2024. If a contract does not materialise by then, the approval to take on foreign loans will lapse.

The TNI-AU has a long-standing requirement for at least four AEW&C aircraft and is known to have shown interest in various aircraft types that can be converted for this purpose, including the Airbus C295.