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From defense diplomacy to defense cooperation
Policies related to the national defense industry might be affected as key decisionmakers shift their focus to the 2024 elections, including Prabowo who is contesting the presidential race.
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Home-grown tech: A Harimau medium tank demonstrates its capabilities during the Indo Defense 2022 Expo & Forum at JIExpo Kemayoran, Jakarta, on Wednesday. The tank is produced by state arms maker PT Pindad. (Antara/M Risyal Hidayat)
Since his appointment as defense minister, Prabowo Subianto has been very active in developing a “defense diplomacy” approach with various countries, in parallel to negotiations of arms procurement. The most recent visit came on July 21, when Prabowo and Foreign Minister Retno LP Marsudi met with their French counterparts in Paris for a 2+2 ministerial dialogue.
At this occasion, Prabowo highlighted President Joko “Jokowi” Widodo’s statement to push collaboration in technology transfer programs and defense equipment procurement as Indonesia is expected to spend a total of US$12 billion for fighter jets, submarines, missiles, radars and other equipment from France.
Increasing defense industry capacity through the transfer of technology is indeed one of the aspects of the defense cooperation agreement (DCA) signed between the two countries back in 2021. Securing such cooperation would not only increase Indonesia’s strategic ties with other countries amid the evolving security challenges, but could also help the national defense industry develop.
According to the Foreign Ministry’s Law and International Agreements Directorate General, a total of 79 DCAs were signed by Indonesia between 1953 and 2022. Just in the past decade, Indonesia signed such agreements with France, Spain, South Korea and Saudi Arabia, to name a few. Furthermore, Australia renewed its DCA with Indonesia in 2021, and Slovakia is expected to ink it this year.
Negotiation at the government-to-government (G2G) level is critical to pave the way for defense cooperation at the business-to-business (B2B) level. Partnerships with France and Spain are the most recent examples that have led to B2B cooperation.
First, the frequent meetings after the signature of DCA with France have provided a platform to push for B2B cooperation between Indonesian defense firms and foreign original equipment manufacturers (OEMs). For example, during the 2+2 dialogue, Retno encouraged both countries, particularly Indonesian state-owned enterprise PT Len Industri and French company Thales, to set up a joint venture and joint production in the hope that the Indonesian defense SOE could enter the global supply chain.
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