26 February 2024

Singapore Airshow 2024: Indonesia proposes delaying AEW&C programme to fund frigates

by Ridzwan Rahmat

An Italian FREMM multimission frigate, similar to what Indonesia is seeking for its own navy. (Fincantieri)

The Indonesian Ministry of Defense (MoD) has submitted a proposal to the country's Ministry of Finance, requesting to cancel the foreign loan approvals allocated for an airborne early warning and control (AEW&C) aircraft and 15 other smaller procurement programmes.

Instead, the MoD wants these allocations to be diverted to a long-delayed effort to equip the Indonesian Navy with Frégate Européenne Multi-Mission (FREMM) frigates, according to a 9 December 2023 letter between the two ministries. A copy of this letter was provided to Janes at Singapore Airshow 2024 by a government source.

In 2023 the Indonesian government had approved for 16 defence procurement programmes to be funded with loans sourced from foreign lenders. These include an approval to take on up to USD800 million in foreign loans to procure an unknown number of AEW&C airframes.

The 15 other programmes, for which approvals to take on foreign loans were granted, include a USD144 million plan to procure VL MICA anti-air missiles, presumably for the Martadinata-class frigates, and a USD48 million initiative to acquire self-propelled air-defence artillery systems.

Formal procurement processes for all 16 programmes have yet to begin, and the total value of these projects is estimated to be about USD25 billion.

“In order to fulfil priorities related to the armed forces' readiness amid a dynamic security situation, it is requested that the finance ministry agree to this request and approve the alternative foreign loan allocation requested by the defence ministry,” said the letter signed by the Director-General of Defence Acquisitions at the MoD, Supo Dwi Diantara.

“The amount of foreign loans to be taken will remain the same despite the switch,” the letter added.

The Indonesian Ministry of Defense (MoD) has submitted a proposal to the country's Ministry of Finan...

Jane's Find unrivaled intelligence, consultancy and advertising solutions to the defence and national security sectors.