Indonesia withdraws from KF-X/IF-X program | World Defense

Indonesia withdraws from KF-X/IF-X program

Lieutenant

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Indonesian government has notified the Korean government that it cannot pay its current share of KF-X/IF-X program due to majority of its budget going towards infrastructure and human development.

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To lower financial burden, the Indonesian government has requested that the Korean government lower its share of the project. Not only do they want to decrease share, but also increase the amount of technology transfer.

They also proposed paying its share in material goods, such as CN-235 transport aircraft, instead of in cash. Indonesian government was originally set to fund 20% of the overall project. This included one prototype aircraft, transfer of technology, and local assembly of 48 IF-X aircraft.

However, Indonesian government has been delaying payment starting in 2017, citing poor economy. They have yet to make payment for 2018 and first half of 2019.

Indonesia is proving themselves to be an unreliable partner. It is my personal opinion that they be kicked out of KF-X program if they continue this trend.

There is no way we should allow them to lower their share while increasing tech transfer; they’re already getting a bargain with current deal.
 

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What an opportunity for Saudi Arabia or the UAE to get involved in the program and benefit from tech transfer.
 

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The jet needs ages to mature. I would be more practical for the said countries to look for handy tot.
 

Indos

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Indonesian government has notified the Korean government that it cannot pay its current share of KF-X/IF-X program due to majority of its budget going towards infrastructure and human development.

View attachment 9398


To lower financial burden, the Indonesian government has requested that the Korean government lower its share of the project. Not only do they want to decrease share, but also increase the amount of technology transfer.

They also proposed paying its share in material goods, such as CN-235 transport aircraft, instead of in cash. Indonesian government was originally set to fund 20% of the overall project. This included one prototype aircraft, transfer of technology, and local assembly of 48 IF-X aircraft.

However, Indonesian government has been delaying payment starting in 2017, citing poor economy. They have yet to make payment for 2018 and first half of 2019.

Indonesia is proving themselves to be an unreliable partner. It is my personal opinion that they be kicked out of KF-X program if they continue this trend.

There is no way we should allow them to lower their share while increasing tech transfer; they’re already getting a bargain with current deal.
Indonesia is technically still inside the program. The previous defense minister has been replaced. The lead negotiator of the KFX/IFX renegotiation (Security Minister) is also replaced. We have many new ministers in Jokowi second term in office (2019-2024). They just sit in their offices just 2 weeks ago.

We should wait for another 3-4 months to see whether Indonesia is really withdrawing or not. For your information, current defense minister is Prabowo Subianto which is Jokowi main opponent during 2019 presidential election, he is an ambitious guy and want to see Indonesia greatness, including in defense, unlike Jokowi who seems to be pragmatic with primary focus on economy development. New security minister is a professor so I hope he will back up the program as he may know the importance of the project for our technology advancement. Another minister (part of economic team) who is opposing the program and wanting to decrease the number of IFX Indonesia should buy is also replaced. I am still optimistic Indonesia will still inside the program but lets see what will happen in the next 3-4 month.

Talking about increase in TOT, the Korean has already rejected it (according to Indonesian respected journalist in defense matter).

The renegotiation should be ended in October but it looks like it will still be continued as we have new defense minister and security minister (and new cabinet as well).


This is the latest news:

Industry
ADEX 2019: Indonesia committed to KF-X project despite fiscal concerns

Jon Grevatt, Seoul - Jane's Defence Weekly

15 October 2019

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An artist impression of the KF-X fighter aircraft. South Korea is developing the platform in partnership with Indonesia, although the latter has fallen behind on payments. Source: DAPA

More than 100 engineers from Indonesian aerospace company PT Dirgantara (PTDI) remain involved in the project with South Korea to develop the next-generation Korean Fighter eXperimental (KF-X) fighter aircraft despite growing concern about the Southeast Asian country's financial involvement in the programme.

Industry officials told Jane's at the 2019 Seoul International Aerospace and Defense Exhibition (ADEX) that ties between PTDI at Korea Aerospace Industries (KAI), which is leading the KF-X programme, remain strong even if the South Korean and Indonesian governments have yet to reach an agreement on how - and how much - Jakarta will pay towards the development project.

"We have 114 engineers working on the KF-X in Korea," said one official from KAI. "They are mainly working on the design of the aircraft but also on manufacturing processes." PTDI told Jane's that its engineers' involvement in the programme is intended to support the company's long-term development and its ability to apply acquired skills across a range of platforms.

Industry officials would not comment directly on government-level talks intended to enable Jakarta to fund its involvement in the programme, which it refers to as IF-X. These talks started in October 2018 after Indonesia said that due to a lack of funding it wanted to renegotiate the financial arrangements that were agreed in 2015. Renegotiations were initially expected to be concluded within 12 months but have yet to be finalised.

Under the original KF-X finance agreement Indonesia is committed to pay for 20% of the total development costs of the aircraft, which are estimated at about USD8 billion. The South Korean government is committed to pay for 60% of costs, with KAI covering the remaining 20%.

 
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