Saturday, January 31, 2015

An Indonesian Defense Revolution Under Jokowi?

Indonesia’s new president is determined to transform its defense industry.

Listen to Indonesian President Joko “Jokowi” Widodo, and you would think the country is on the brink of nothing less than a defense revolution.

At a meeting late last month at the Presidential Office attended by top ministers and advisers, Jokowi outlined the main priorities for the country’s defense policy. What stood out most was his determination to revolutionize the country’s defense industry, partly in order to create the self-reliance in military equipment that Indonesia has often talked about. That is not surprising, considering that the defense industry is the foundation upon which several of his foreign policy goals – including a global maritime fulcrum – are built.

In his remarks, Jokowi did lay out some specific guidelines might help Indonesia reach defense self-reliance. For instance, Indonesia will require every weapons purchase to include the transfer of technology for Indonesia’s state-owned strategic industries – including shipbuilder PT PAL, weapons and land systems maker PT PINDAD, and aircraft maker PT DI. Jokowi is already moving to prop up some of these state-owned defense entities. In early January, he announced $55 million in government funding to boost PT PINDAD following a visit to its facilities.

But others were more strategic considerations for the defense industry more generally. He said Indonesia should stop its habit of chasing after foreign weapon systems without making efforts to boost domestic production. He also added that the focus should be on building integrated defense equipment systems. Predictably, he also found a way to work in his global maritime fulcrum doctrine, emphasizing that the country’s shipbuilding industry should be able to produce non-military equipment as well like commercial ships. The whole point of this defense transformation, Jokowi stressed, is to ensure the industry is “developed for long term use, not only for one or two years.”

Of course, in many cases Jokowi is either building on previous plans or following long-sought goals. The ideal of self-reliance, for example, is reflected in the 2012 Law on Defense Industry, and is central to realizing the country’s goal of developing the Indonesian military (TNI) into a minimum essential force by 2024. Incremental progress had already been made during the Yudhoyono years on several strategic projects that involve technology transfer and enhancing local capabilities. The problem of lack of integration in defense systems has also been well-documented. To get a sense of the problem, as I have noted elsewhere, Indonesia was operating 173 different weapons systems from 17 different countries by 2006 according to one estimate.

The inherent constraints to achieving this revolution in Indonesia’s defense industry are also clear. There are a long list of them, but a couple are worth noting here. Funding is one concern. Despite recent increases, Indonesia’s military budget has never constituted more than one percent of its GDP, unlike some of its neighbors like Malaysia or Vietnam. Jokowi says he plans on raising the budget to 1.5 percent of GDP, but it is unclear whether he will achieve it, and how much of that budget will be devoted to goals like providing support for state-owned defense entities as opposed to personnel costs, which form the bulk of the budget.

Self-reliance is also an ideal that may be difficult to achieve in practice. TNI chief General Moeldoko – no stranger to controversy – insisted earlier this month that the country’s military still needs foreign-made weapons. Quite apart from Moeldoko’s own admission that he “salivated” looking at other nations’ equipment during search and rescue operations for AirAsia flight QZ8501, building a sophisticated defense industry at home takes time. Given Indonesia’s urgent need to accomplish basic tasks effectively – such as policing its own waters – Jakarta may find itself relying far more on competitive foreign weapons systems than Jokowi would like for now, even as it has its eye on developing a strong and capable defense industry in the future. The Diplomat

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