Based on the Navy strategic plan, Rencana Pembangunan Kekuatan TNI-AL Jangka Panjang (2005-2024), Indonesia has initiated a strategic concept of minimum essential forces to serve as a transition force in the long-term process of creating the future force of 2024.
For the Navy, the end goal of this strategic plan is the creation of the future force called the Sistem Armada Terpadu 2024 (Integrated Navy Fleet System of 2024). This future force structure will consist of 56 frigates, 38 corvettes, six minesweepers and 10 submarines as the main strike force. The 2024 force structure will also be strengthened by the deployment of 66 fast patrol boats, as well as another 98 ships that will be part of a supporting force for the Navy.
The Navy future force will be built based on the combination of a capability-base approach and task-oriented approach. These approaches will be used to guarantee the Navy will still have a sufficient power projection capability during its transitional process. Based on these approaches, a minimum of one strike force and patrolling force is needed to maintain the security of Indonesia's territorial waters during the transitional process.
One of the biggest problems of Indonesia's weapons system is the military's dependence on foreign suppliers. Most of the weapons systems are imported from other states and financed using foreign credit facilities.
In identifying the degree of military dependence, I use the Concentration of Arms Supply Indicator (CASI). Total numbers of naval weapons imported to Indonesia are divided into 13 categories: Frigate, corvette, submarine, patrol boat, minesweeper, landing ship, command ship, tanker/oiler, coastal transport, fleet tug, survey ship, research ship and training ship.
A CASI index of 1.00 represents the highest possible concentration, meaning all weapons are imported from a single country. CASI scores are ranked as follows: very high concentration (0.81-1); high concentration (0.61-0.80); moderate concentration (0.41-0.60); low concentration (0.21-0.40); and very low concentration (0.01-0.20). An index of 0.00 can be interpreted as no arms imports.
Based on the computation of the CASI Index, in 2008, the average level of concentration in naval weapons systems is 0.617 (high concentration). A very high level of concentration can be found in five types of weapons systems: Corvettes, minesweepers, submarines, command ships and research ships.
The last three systems have a score of 1.00 which means that these systems are militarily dependent on a single supplier. Only two systems enjoy a low concentration of arms supply: Tankers/oilers and survey ships. The rest of the fleet has a moderate level of concentration.
When I separated suppliers into two distinct categories of no-embargo against Indonesia and embargo against Indonesia, the CASI Index for all warships is 0.633. Indonesia has a high score of concentration of naval weapons from countries that imposed arms embargoes. The 2005-2024 procurement programs must ensure that this kind of military dependency will not be repeated.
Another consideration in implementing the strategic plan of 2005-2024 is identifying aging warships. This usually consists of three main methods: Arms maintenance, arms reduction and arms build-up. The logic behind this plan is simple: Dispose all the warships that have been commissioned for more than 35 years.
This will result in four phases of naval weapons reduction from 2008 to 2024 that should be conducted by Indonesia. Overall, there are 93 ships that should be decommissioned by 2024. In 2008, Indonesia should dispose of four ships that have been in service for more than 50 years. In 2009-2014, 28 ships must be disposed of, in 2014-2019, 44 ships should be decommissioned, and finally, in 2019-2024, the last 14 old ships should be decommissioned.
The main predicament of this proposal is whether Indonesia have the (financial) capability to systematically replace the 93 decommissioned ships by 2024? The program of arms reductions will leave Indonesia with only two corvettes, one fleet tug and two research ships. Basically, Indonesia will have to develop its future Navy from zero.
To develop its future Navy a defense economics model must be introduced. The main question of this model is can Indonesia financially support its strategic planning to develop the future force? In this model, some defense economics adjustments should be made to enable Indonesia to fulfill the naval defense requirements of 2024.
The first economic adjustment is allocation of military expenditures. The main problem for Indonesia is deciding how much is enough. Since 2000, the government has significantly increased its defense spending by more than 300 percent from 2000-2008.
In 2007, the Defense Ministry proposed a defense budget of Rp 110 trillion (US$12.2 billion), but the government only supported 28.2 percent of the proposed budget.
The biggest problem for Indonesia in making defense economics adjustment of its defense expenditures is related with the classic economics debate of guns versus butter. From 2000-2007, the government only spent approximately an average of 0.79 percent of GDP in defense spending.
However, this low figure of defense spending was already the third highest central government expenditure after education and health expenditures. In 2007, the government allocated almost 19 percent of the central government expenditures for defense.
Increasing defense spending by only 20 percent will make defense spending the highest central government expenditure. In a country that still has 17 percent of its population living below the poverty line, such increase will become political suicide. No government can sell that kind of budget structure to the parliament.
To support the Navy strategic planning, the Strategic Defense Review document indicates that in 2005-2009, the Defense Ministry proposed making naval expenditures the first priority.
The reallocation was also supported to give a bigger allocation of credit export facilities to finance Navy weapons procurement. In 2006, the Defense Ministry already secured 70 percent of its 2005-2009 financial requirements to procure weapons with the signing of a memorandum of understanding on military cooperation between Indonesia and Russia.
For the Navy, the support of Russia state credit of $1 billion is not sufficient to secure its proposed 2005-2009 weapons procurement. For 2005-2009, the Navy was planning to procure four corvettes, two frigates, three submarines and four landing ships. A foreign credit of about $2billion is needed to procure these weapons. This figure is already a 43.9 percent cutback from the initial $4.5 billion proposal submitted to the government in 2005.
Based on this trend, it is not likely for Indonesia to find sufficient financial support to reach its goal of the 2024 future force.
Since there are no short-term remedies for this predicament, I propose the Navy reduce significantly its defense requirements by reducing its 2024 force structure.
The writer, who holds an MSc degree from the London School of Economics and Political Science, is a lecturer in the Department of International Relations at the University of Indonesia, Jakarta, and a researcher at the Center for East Asian Cooperation Studies (CEACoS).
