Marina Ika Sari
Researcher, ASEAN Studies Program

The Urgency Of Alutsista Modernization And Realizing A Self-Reliant Defense Industry

We do not have to choose between economic development and defense as they have to go in tandem. Alutsista modernization is a long-term defense investment to safeguard Indonesia's territorial integrity including its economic sovereignty (economic resources and infrastructure).

Major arms (alutsista) are one of the key elements that make up Indonesia's defense posture. In building the national defense posture, the government adopts capability-based planning concept set forth in the Minimum Essential Force (MEF) program.

MEF serves as the cornerstone of TNI modernization that must be prepared as the main and fundamental prerequisite for the effective implementation of its main duties and functions in dealing with threats. The MEF program is to be completed in three phases: Phase I (2010-14), Phase II (2015-19) and Phase III (2020-24).

According to the Defense Ministry data, MEF Phase I and II did not meet their targets: Phase I was 54.97% out of the 57.24% target and Phase II was 63.19% out of the 75.54% target. Apart from budget constraints, another reason why Phase II was not achieved was because the planning and procurement processes took longer than expected. Currently, Indonesia is in Phase III where the government is still 36.81% short of the 100% target to achieve in 2024.

The urgency of alutsista modernization

There are internal and external factors that urge the government to rejuvenate the alutsista. Internally, Indonesia's alutsista have been largely outdated and insufficient. As many of them are already more than 25 years old, they cannot operate optimally. The number of existing weaponries does not meet the MEF ideal state. There is also issue of interoperability. According to Military Balance 2022 report published by the International Institute for Strategic Studies, only about 40% of Indonesia's defense equipment is operationally ready. This of course can undermine TNI combat readiness and pose safety risk to personnel operating them.

Externally, Indonesia's readiness to face global geopolitical dynamics such as the South China Sea (SCS) dispute, the Myanmar crisis, the US-China rivalry in the Indo-Pacific region, the formation of AUKUS, to the Ukraine crisis. In order to increase its defense capability in the midst of these strategic environment dynamics and the potential of increasingly complex threats in the future, alutsista modernization is deemed critical in order to increase Indonesia's bargaining position and present deterrence in the global political arena.

Alutsista modernization strategy

After being sworn in as defense minister in 2019, Prabowo Subianto has paid great deal of attention to the procurement and modernization of defense equipment. Budget wise, the Defense Ministry seeks to optimize the procurement, modernization and maintenance of defense equipment. Defense budget allocation for 2021 reached Rp137.3 trillion (Rp9.3 trillion for arms procurement, Rp20.1 trillion (14.6%) for the modernization and maintenance of defense equipment across the three branches of service -- Rp3.88 trillion for the army, Rp8.03 trillion for the navy, and Rp8.19 trillion for the air force.

Defense Minister Prabowo have purchased a number of indigenously produced defense equipment, including the PT Pindad-made Antasena tank boat and 500 Maung 4x4 light tactical vehicles; 9 PT DI-made Bell 412EPI assault helicopters; PT Bandar Abadi-made AT-8 and AT 9 tank landing ships; and PT Lundin Industry Invest-made KRI Golok-688. In addition, two units of anti-submarine helicopters and a unit of CN235 MPA aircraft made by PT DI were recently handed over by the Defense Ministry to the Indonesian Navy.

This shows that the domestic defense industry has the capacity to produce defense equipment to not only meet domestic needs but also for export. Indonesian-made defense equipment have been purchased by countries in ASEAN, Africa, even Europe.

Defense diplomacy to improve domestic defense industry

In addition to buying defense equipment from domestic defense firms, Minister Prabowo has also actively conducted defense diplomacy with Indonesia's partner countries. In almost every bilateral and multilateral meeting, he always seeks to explore or enhance defense cooperation. The tangible results from this endeavor included the cooperation agreement to purchase eight units of Italian-made frigates; British frigate Arrowhead 140 license; 2 units of Airbus A400M military transport aircraft from the United Arab Emirates; six units of Dassault Rafale fighter jets (out of a total of 42 units planned); and two French-made Scorpene submarines. However, there is still some homework to be done regarding the sustainability of Indonesia-South Korea joint production of KFX/IFX fighter jets and the plan to purchase 36 units of F-15 fighter aircrafts from the US.

Through defense diplomacy, Indonesia aims to enhance the capacity of its defense industry and develop the national defense industry capability through cooperation between the government, SOEs, and private sector. In procuring defense equipment from other countries, Indonesia does not only buy the hardware, but also prioritizes technology transfer, trade reciprocity, offsets, maintenance support, as well as research collaboration to improve the human capital in the defense sector. This is also in line with President Joko Widodo's directive that the defense sector must shift from mere procurement to long-term investments.

Alutsista modernization does require a huge budget, hence it needs comprehensive planning based on clear, measurable, sustainable priority scale, as well as projections and forms of potential threats in the future. There needs to be consistency and joint commitment on the policymakers' part because alutsista procurement and modernization take time. The government can optimize the role of the domestic defense industry to produce defense equipment through the triple-helix synergy.

Furthermore, defense diplomacy with various countries through arms procurement is part of a diversification effort so that Indonesia is not heavily-dependent on a particular arms supplier. It is of high importance that Indonesia adjusts its global supply chain in order to shield itself in the event of an attack or embargo from another country. Next, the government also needs to increase the combat capacity and capability of TNI personnel in line with the technological advancement of next-generation defense equipment. Thus, it is hoped that alutsista modernization will allow Indonesia to realize a self-reliant defense industry.


Profil Penulis : [yang dimuat hanya versi English]

Marina Ika Sari, M.Si (Han) is a researcher at the ASEAN Studies Program, The Habibie Center. She hold a master's degree in defense diplomacy from the Indonesia Defense University (UNHAN).

2015-2017 : Master's degree in Defense Diplomacy, UNHAN
2009-2013 : Bachelor's degree in International Relations, Syarif Hidayatullah Islamic State University, Jakarta

Ingin mendapatkan informasi aktifitas The Habibie Center?