MEF phase III based marine Alutsista modernization policy

The Indonesian Military development policy in 2019 entered the third phase of the Minimmum Essential Force (MEF) policy framework. Reported by the Indonesian Media, TNI Commander Marsekal Hadi Tjahjanto said the overall achievement of the MEF policy until the year 2019 has reached 72%. The MEF policy began in 2009, divided into three phases, namely the first phase 2009-2014, the second phase 2014-2019, and the third phase of 2019-2024. MEF policies are supported consistently by defense budgets that tend to increase annually.

Entering the third phase of the MEF there are some momentum that increases the optimism of the policy will be achieved in full in 2024. Year 2019 is the second reign of President Joko Widodo, the government is run by the Indonesian cabinet Maju. President Joko Widodo appointed Prabowo Subianto to be the Minister of Defence in the place of Ryamizard Ryacudu 2019-2024. The Momentum was supported by a 2020 defence budget of 126 trillion Rupiah, an increase from 2019 by 16%, the budget was 5% of the total APBN ( With the rise in defense budgets that tend to be stable, Indonesia ranks 26 countries with the highest defense budget in the World (SIPRI, 2019). The Ministry of Defense targets the existing budget, MEF can be fulfilled until 2024.

MEF is a complementary policy between variables in it. There are at least four elements of MEF builders namely rematerialization, procurement, revitalization, and relocation. These four elements are concentrated on the point known as the flash point that is part of the Indonesian territory that is identified as an area that has a high potential for various actual threats. Flash Point became the basis of priorities for the composition and the disposition of MEF gradually and continuously. Mentioned in the White Defence Book of 2018, the MEF policy does not lead to the arms race but fulfilment of Indonesia's minimum defence needs.

MEF's policies should accommodate a variety of defense-related policies to create the ideal defense development policy. One of the policies related to the Alutsista is the policy of domestic defense industry through LAW No. 16 year 2012. In the legislation mandated to state enterprises defense industry became the lead integrator development of the Alutsista. Further decree of the KKIP KEP/12/KKIP/XII/2013 mentioned PT PAL Indonesia (Persero) became the lead integrator development of Alutsista Matra Sea. Ideally the MEF policy is built to accommodate the domestic defense industry, so it will realize defense development based on the independence of the defence industry. Good and sustainable synergy is based on a strong commitment between users (the Ministry of Defence) and the defence industry is a prerequisite for the independence of defense industry.

The Independent defense industry is a vision to be achieved. Not only to meet domestic needs, but also for export needs. MEF policy should be the driving force of independence of defence industry in the first way, procurement of alutsista based on the capability of domestic defense industry. Secondly, if the domestic defense industry has not been able to meet, then procurement through foreign producers, transfer of Technology (ToT) to the domestic defense industry into a prerequisite. It will be the basis of the technological mastery of the future.

Domestic defence industry

Until now the government is relatively consistent in its commitment to prioritize the domestic defense industry for the procurement of Alutsista. PT PAL Indonesia (Persero) is capable of realizing the missile rapid ship procurement contract (KCR) 60 meters, the Landing Platform Dock (LPD) 125 meter, the hospital auxiliary vessel (BRS) 124 meters, and the class submarine Changbogo. Realization of settlement development in terms on schedule and even in the category ahead delivery. The mastery of the ship technology above is owned with a ToT scheme which is then developed by according to the needs of the user by PT PAL Indonesia (Persero). In the future, the Government's commitment to the scheme should remain strong to ensure sustainabilitas the domestic defense industry.

The mastery of technology by the strategic industry is not a simple thing. The country has made substantial investments in PT PAL Indonesia (Persero) through the inclusion of the state capital (PMN). The investment is used to support the success of technology mastery, ToT and Transfer of Knowledge (ToK). As with other investments, the value is as time goes on as the depreciation results from the depreciating influence, amortization, and others that are charged to the company's overhead. The investments have been made to the fullest extent possible for high-tech projects such as LPD, PKR, Frigate and submarine to maintain productivity and sustainabilitas. In this investment, there are people's mandate for the benefit and unity of the unitary Republic of Indonesia (NKRI).

There are two mechanisms of defense technology mastery, first through comprehensive and second research through the ToT scheme. Each has its strengths and weaknesses. ToT can be an option because it has the advantage of Shorten lead time research and development. Regardless of government choice, the end goal is to realize the independence of defence industry in the frame of national interest of the Indonesian nation.

Based on the needs of the TNI, there was a discourse to acquire two units of the Danish class frigate warships, made in Denmark. Coordinating Minister for the field of Kemaritiman Binsar Panjaitan reported by on the occasion of the relationship with the retired parents of the TNI AL Jala Nusantara in January 2019 revealed to be built two units of class frigate Iver Huitfeldt at PT PAL Indonesia (Persero) with ToT scheme. The statement is in accordance with the constitutional mandate of the defence industry. It is constitutionally mandated through LAW No. 16 year 2012. In the law BUMN defence industry became the lead integrator development of the Alutsista. Further decree of the KKIP KEP/12/KKIP/XII/2013 mentioned PT PAL Indonesia (Persero) became the lead integrator development of Alutsista Matra Sea. PT PAL Indonesia (Persero) has experience and capability in ToT partnership, as well as development capability and adjustment for adjustment of TNI AL needs. The technical scheme and percentage of ToT become special attention later, in line with national interests of the nation of Indonesia.

The ability of ocean roaming is considered to be a frigate procurement consideration. Reported from, the vessel has a length of 138 meters, a maximum speed of 30 knots, and a crew of 165 personnel. The ship can be armed with a type BGM-109 Tomahawk missile or similar. The procurement will further strengthen the TNI AL to protect the territory and bring a deterence effect. But there is a note that should be a government concern, the prerequisites of ToT become a mandate that should remain consistent to run.

To ensure the mastery of advanced defense technology by the nation's children. PT PAL Indonesia (Persero) has a previous record of success in ToT as in the Speed Patrol program (FPB), LPD, Missile control Patrol (PKR), and submarine. PT PAL Indonesia (Persero) has readiness to run the ToT program and ensure the mastery of technology as well as the sustainability of Iver Huitfeldt class frigate production.

Challenges ahead

The challenge for government, especially the Ministry of Defence, is to ensure the achievement of the MEF stage III target according to the existing budget and formulate the next policy. In conducting MEF policy the government should remain consistently optimizing the capability of domestic defense industry in line with the mandate of the Constitution. An Alutsista import policy can be done if the domestic defense industry does not have the ability to provide, but each procurement policy through imports requires ToT with a favorable scheme for the Indonesian nation.

Prepared by: Department of Public Relations of PT PAL Indonesia (Persero)