Rendi Akhmad Witular and Yuli Tri Suwarni, Bandung – The government has gathered its strategic state enterprises together to develop the country's arms industry and increase self-reliance in defense.
On Tuesday, 10 strategic state firms, the Ministry of Defense, the Indonesian Military (TNI) and the Office of State Minister of State Enterprises signed memorandums of understanding to improve cooperation.
President Susilo Bambang Yudhoyono witnessed the signing, which took place at the head office of state aircraft-maker PT Dirgantara Indonesia (DI) in Bandung.
The move came as the United States resumed sales of lethal arms to Indonesia after a 13-year embargo. However, the cash-strapped government currently plans only to buy transport aircraft from the US because it can afford little else.
The agreements signed include cooperation deals between the Ministry of Defense, the Ministry of Industry, the Office of State Minister of State Enterprises, and the Office of the State Minister of Research and Technology to accelerate and enhance the production of defense utilities.
The four ministries also agreed to boost research in the defense sector, while the companies signed MOUs to synchronize their businesses and begin producing weaponry.
Among the companies signing the MOUs were PT DI, Army weaponry firm PT Pindad, state explosives supplier PT Dahana, state steel producer PT Krakatau Steel, state ship builder PT PAL, state telecommunications equipment producer PT INTI and state train builder PT INKA.
"Our defense industry should function both as a commercial entity and as a provider of domestic defense and military needs. The industry should produce war machines based on our geographic conditions and the threats that we are facing," Susilo said.
Susilo repeated his order to the Ministry of Defense and the TNI to prioritize the procurement of arms from domestic suppliers before looking overseas.
"Should we need to seek (arms) from overseas producers, make sure that they don't come up with conditions that prevent us from utilizing the weapons when we need them," Susilo said. He was referring to the arms embargo imposed by Washington over the TNI's poor human rights record.
Susilo also said the government would immediately seek ways to restore the production capacity of ailing PT DI by seeking several strategic investors or by requiring the TNI to increase its purchases from the company. The inefficient and mostly idle PT DI will need an estimated US$200 million to fully resume production.
Hundreds of Bandung university students followed Susilo on his visit to the aircraft maker and PT Pindad, demonstrating outside. The students called on the President to boost efforts to combat corruption and to slash the high fuel prices.
Susilo later met student representatives at a restaurant to hear their complaints and to explain to them the problems the government faced.