Indonesia embarks on barter trade for weapons

Among the deals it is pursuing is a swop of four domestic-made jets for a warship and trucks from S. Korea.

Indonesia is in the market for defence equipment in exchange for locally-made products and natural resources.

Defence sources here told The Sunday Times that a rapidly declining military budget and an arms embargo by the United States had forced the Indonesian armed forces (TNI) to source weapons from South Korea, China and Romania through barter.

“We need to modernise especially the air force and navy but are really short of money,” said a one-star general in charge of arms procurement.

Defence Minister Mahfud M.D. disclosed on Friday after a meeting with his South Korean counterpart Cho Sung Tae, that Jakarta was keen to swop four domestic-made CN235 airplanes for a warship and other equipment from Seoul that included army trucks and a trainer aircraft.

The CN235 is a two-engine propeller plane that can carry 18 people. It is manufactured by the state-owned aircraft manufacturer, IPTN.

The general who handles arms procurement said that the swop with South Korea had been on the cards for the last year. “The military budget has declined considerably,” he said. “We need to come up with ways to make up for the shortfall and at the same time try to develop the TNI.”

The government had earlier this year proposed to Parliament a more than 10-per-cent increase in overall defence and security expenditures, setting the budget at 10.1 trillion rupiah (S$1.92 billion). The proposal fell through, however.

Besides this, the TNI suffered a severe blow when the US, Indonesia’s primary supplier of weapons systems for several decades, cut off military links after the East Timor debacle last year.

The Sunday Times understands that Jakarta is also looking to China for arms. Its air force sent a team there in April to examine the potential for maintenance and equipment supplies.

TNI sources said they were keen to get arms from Beijing in exchange for “natural resources” which they did not specify. Dr Mahfud said Romania was also on the list.

The latest initiative takes place against a backdrop of attempts by the air force and navy to modernise their equipment.Noted a foreign diplomat: “The TNI is really scraping the bottom of the barrel.”

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