Indonesian defence minister proposes to receive USD20 billion in foreign credit for 2020–24

Indonesia’s Minister of Defence, Prabowo Subianto, has forwarded a proposal for the country to receive up to USD20 billion in defence-related foreign credit and assistance schemes for the period spanning 2020–24.

Among programmes that may be funded via the proposed foreign defence credits include two follow-on warships to the Martadinata-class frigates. (Damen)

The proposal was sent to the Indonesian Minister of National Development Planning, and Head of the National Development Planning Agency, Suharso Monoarfa, on 13 July 2020. A copy of the letter was received by Janes in early September 2020.

The foreign credit and assistance schemes will be used to fund acquisition programmes for all three branches of the Indonesian Armed Forces between 2020–24, the defence minister indicated.

Among possible big-ticket acquisitions that may be funded with the foreign credit include 24 Lockheed Martin F-16V fighter aircraft and two follow-on warships to the Indonesian Navy’s (Tentara Nasional Indonesia – Angkatan Laut: TNI-AL) Martadinata (SIGMA 10514)-class frigates.

The request was made against the backdrop of a nearly IDR9 trillion (USD588 million) cut to the country’s defence budget for 2020. The reduction has been made partly in response to the ongoing Covid-19 outbreak, which has severely damaged the country’s economy.