Indonesia, Turkey sign defence co-op agreement

CN-235 anti-submarine PT.DI Indonesia

JANE'S-(IDB) : Indonesia and Turkey have signed a defence agreement in Jakarta that could see the two countries collaborating on a wide range of military programmes. The Indonesian Ministry of Defence (MoD) said on 7 April that the ‘Draft Protocol on Defence Industry Co-operation’ was signed by Indonesia’s Deputy Minister of Defence Sjafrie Sjamsoeddin and his visiting counterpart Murad Pay.

The draft protocol outlines the joint development of an armoured combat vehicle likely to be undertaken by Turkey’s FNSS Savunma Sistemleri and Indonesia’s state-owned PT Pindad, various missiles, rockets and propellants, and a software-defined radio system. Once contractual obligations and negotiated, these programmes would almost certainly be based on Turkish-designed systems with further development and production in Indonesia. Such a strategy conforms with Indonesia’s priority of developing its industrial assets.

In addition to these programmes, Turkish Aerospace Industries (TAI) and PT Dirgantara Indonesia are planning to develop a prototype of an anti-submarine warfare version of the CN-235 maritime patrol aircraft, a platform that was jointly developed by Indonesia and Spain and manufactured in Turkey and Indonesia. TAI is also bidding to upgrade Indonesia’s fleet of ageing F-16s. The defence protocol was signed during Turkish President Abdullah Gul’s state visit to Indonesia, during which a number of agreements have been signed by the two countries that are aimed to increase bilateral trade in all sectors to USD5 billion by 2014 and to USD10 billion in the longer term. Bilateral trade between Indonesia and Turkey in 2010 stood at USD1.7 billion.

In terms of meeting these targets, President Gul indicated that defence trade was regarded as a priority. “[Indonesia] has huge borders,” he said. “That’s why security is so important for them. They want the co-operation of a friendly country like Turkey in the defence industry. Turkish contractors should act promptly to claim a share in this market.” Gul added that Turkey’s “GDP is USD800 billion, [and Indonesia] has a GDP of more than USD700 billion. This shows that both countries have investment potential. What is important is for our business people to find that potential. That’s why I have come here with business people.”

The focus on defence trade builds on a memorandum of understanding (MoU) signed by the two countries in June 2010 that called for expanded defence industry collaboration over the next few years. It is also consistent with Turkey’s drive to increase military sales. In 2009 defence exports from Turkey were reported to have reached around USD660 million, although it plans to more than double these sales by the end of 2011.

Analysis

The draft protocol in defence between Indonesia and Turkey is another marker demonstrating Ankara’s priority to boost sales in the expanding Southeast Asian region – particularly in Indonesia and Malaysia.

In addition to potential deals in Indonesia, earlier this year FNSS signed a USD600 million export contract with Malaysian company DRB-Hicom Defence Technologies (Deftech) to design and develop 257 8×8 wheeled armoured fighting vehicles (AFVs) for the Malaysian Army. Under the contractual arrangement, the vehicles will be based on the Pars (Leopard) family of AFVs and will be redesigned and developed with Deftech at FNSS facilities and assembled in Malaysia.

The defence partnerships between Turkey and these two Southeast Asian nations are further enhanced by religious links. All three countries are Muslim-majority states and all three form a key part of network of countries that has increased defence collaboration in recent years. Other countries that have close defence links through this networking include Brunei. Jordan, Pakistan, Uzbekistan and Yemen.

Source: Jane's