In a strategic move that marks a turning point in international defense collaborations, South Korea and Indonesia are finalizing the transfer of a KF-21 fighter jet prototype. This development concludes a decade-long negotiation process aimed at manufacturing these advanced jets in Indonesia.
Yusuf Jauhan, the head of Indonesia’s Defense Logistics Agency, confirmed in June that Indonesia will not proceed with domestic KF-21 production as initially planned. This follows the 2015 agreement which envisioned a co-production scheme in Indonesia. The KF-21 Boramae, crafted by Korea Aerospace Industries, was designed to replace South Korea’s older F-4 and F-5 jets, with Indonesia intending to use them for similar purposes.
Initially, Indonesia committed to funding 20% of the KF-21’s development costs, estimated at 1.6 trillion won ($1.3 billion), with payments spread until 2026. The agreement included technology transfer to Indonesia’s PT Dirgantara Indonesia (PTDI) for producing 48 units of the KF-21 Block-I in Bandung. However, delays and data theft allegations complicated the deal, leading to numerous renegotiations over cost-sharing.
In 2024, Indonesia sought to extend its payment timeline to 2034, a proposal South Korea rejected due to its impact on deployment schedules. Instead, the nations agreed to lower Indonesia’s contribution to 600 million won, but this adjustment narrowed the scope of technology transfer.
The KF-21 co-production deal’s status was shrouded in uncertainty until Indonesian authorities confirmed in April that domestic production would cease, a decision reiterated in June. After settling the reduced financial commitment, Indonesia will receive a single KF-21 prototype. Officials indicated a preference for purchasing complete jets rather than engaging in co-production.
Hyung-Ju Kim, president of the Security Management Institute, commented, “Indonesia may still want the aircraft, but not necessarily the burdens of local co-production. From Seoul’s perspective, this is probably easier to manage and potentially more attractive for the KF-21’s broader export campaign.”
If realized, Indonesia’s acquisition of the KF-21 could serve as a key reference for future buyers, enhancing the jet’s market appeal. While Indonesia continues to explore procurement options, PTDI confirmed ongoing internal discussions without any concrete plans yet.
In the meantime, Indonesia is reportedly considering expanding its fleet with 24 more Dassault Rafale jets, complementing the 42 already ordered under a 2022 agreement. Additionally, a $10 billion loan arrangement with Turkish Aerospace Industries will see Jakarta acquiring 48 KAAN stealth jets, with deliveries starting in 2032.
