30-11-2023 (JAKARTA) Indonesia’s outgoing president has given the green light for a substantial 20% increase in defence spending until the culmination of the next year. The announcement, made by Finance Minister Sri Mulyani Indrawati during a press conference on Wednesday (Nov 29), revealed that the approval was granted in a meeting with President Joko Widodo and Defence Minister Prabowo Subianto.
Prabowo, a key contender in the upcoming presidential election scheduled for February, is running alongside President Widodo’s son. The surge in defence budget is set to elevate the country’s military capabilities, addressing the need for modernized equipment amid shifting geopolitical landscapes.
According to Sri Mulyani, the defence budget will witness a rise from the current US$20.75 billion to US$25 billion. She highlighted that the Ministry of Defence presented these requirements, deeming them imperative considering the state of the nation’s military hardware and the escalating threats posed by evolving geopolitical and geo-security dynamics.
Despite the noteworthy increase, Sri Mulyani clarified that the overall defence budget for the three successive five-year periods spanning from 2020 to 2034 will be maintained at US$55 billion. This strategic alignment, she asserted, aligns with her medium-to-long-term fiscal plans.
Foreign loans will serve as the source of these additional funds, Sri Mulyani stated. This decision reflects Indonesia’s commitment to bolstering its defence capabilities without compromising its fiscal sustainability.
Prabowo has spearheaded a series of military hardware procurements, including a purchase of 42 Dassault Rafale fighter jets amounting to US$8.1 billion, 12 Turkish Aerospace drones valued at US$300 million, and 12 Mirage 2000-5 fighter jets with a price tag of US$800 million. Additionally, the country entered into an agreement to acquire 24 transport helicopters from the United States-based weapons manufacturer Lockheed Martin in August, the financial details of which remain undisclosed.
This surge in defence spending underlines Indonesia’s proactive stance in fortifying its military readiness and adapting to contemporary security challenges.
