Indonesian Aero News

[Ananda]

The problem is that he has the obsessive urge to post daily something.

Twitter can be good business for him, thus his obsessive urge as you call it part of his strategy to feed off Indonesian forumers need of 'whispers' and 'rumours'. Increase his followers and Twitter feed response.

Anyway MinDef decision to tone down Right now, shown that whatever their strategic development for Defense still not get firm Political and more importantly Financial backing yet from Administration and Factions in Parliament.
Also the activities from Ministry of Finance still focusing on calculate how much Budget and Credit Line that can be allocate for continuing Infrastructure work and Vaccines as priority. With commercial spending still weak, Government Infrastructure projects is the one this administration depends for pulling the Economy moving again.

Will be sometime before any new defense projects got definite funding, in my opinion.

 

[ngatimozart]

The problem is that he has the obsessive urge to post daily something. Because of that his posts are normally below Defencetalk-level.

He never share links or other references, so its hard to directly check his statements, claims and predictions. And thats why some people still believe him and why he is worshipped as an oracle by his fans.

I see @Ahmad thinks your analysis is a joke. He's probably an acolyte and a worshipper as well. But it is human nature and some people believe that the world is flat and others believe that contrails behind aircraft are chemtrails that spray mind control chemicals for governments to control their populations. However here we do have standards as some posters find out the hard way.

As far as those obsessive urges go said twitterlatie should be careful because obsessive urges can cost you a lot of money. Just ask Donald Trump.

 

[Sandhi Yudha]

I see @Ahmad thinks your analysis is a joke. He's probably an acolyte and a worshipper as well. But it is human nature and some people believe that the world is flat and others believe that contrails behind aircraft are chemtrails that spray mind control chemicals for governments to control their populations. However here we do have standards as some posters find out the hard way.

As far as those obsessive urges go said twitterlatie should be careful because obsessive urges can cost you a lot of money. Just ask Donald Trump.

Maybe he see it as a joke, maybe he is (partly) agree but sees my explanation as funny....lets think positively...

I just read that Germany wants to phase out 38 Tranche 1 EF2000s the coming years and plan to sell them abroad. So it can be an alternative for the Austrian Eurofighter fleet of 15 Tranche 1s. It probably also has a positive effect on the price for potential costumers.

Germany signs for ‘Quadriga' Eurofighters

Germany has signed for the procurement of additional Eurofighter combat aircraft for the Luftwaffe under the country’s Project Quadriga procurement plan.

www.janes.com

I am still learning English, so please correct me if i make mistakes.

 

[Ananda]

just read that Germany wants to phase out 38 Tranche 1 EF2000s the coming years and plan to sell them abroad. So it can be an alternative for the Austrian Eurofighter fleet of 15 Tranche 1s. It probably also has a positive effect on the price for potential costumers

The idea of ex Luftwaffe Tranche 1 plus ex Austrian Tranche 1, give rumours why Prabowo's attracted to the idea of procuring those tranche 1 and doing upgrade Job in DI with Airbus help.
Plus some rumours of Spanish offer to help upgrade those Tranche 1 in the line with their own Tranche 1 upgrade program.

So far Spain is the only one that upgrade Tranche 1, toward something that combine elements of Tranche 2 and 3. If the rumours on Spanish offer has some validity, then it can provide attraction.
If the prices are right, and the upgrade budget can be worked toward Spain upgrade program, I can see why Prabowo's will be tempted on that.

Anyway all still rumours, but I can see Political attraction with gaining enough Fighters for 3 sq. Combine with attractive packages and upgrade Job involving DI. This administration can achieve the target for rejuvenate TNI-AU Fighter ORBAT within their second term, as compensation of the delays they're doing in First Term.

 

[OPSSG]

Both Eurofighters and F-16Vs are valid options that I support.

However, based on availability calculations below, I do not favour a Tranche 1 buy.

Rather, I see advantage in a two squadron buy of new 32 F-16Vs (plus 4 spare engines) — this will give the TNI AU much more value for money, when we factor in pilot training costs, a simulator, operating costs and remaining air frame hours (a lifespan of up to 12,000 flight hours). This means it can remain service for 50 years.

The idea of ex Luftwaffe Tranche 1 plus ex Austrian Tranche 1, give rumours why Prabowo's attracted to the idea of procuring those tranche 1 and doing upgrade Job in DI with Airbus help.

38 + 15 = 53 Tranche 1

Assuming that these Eurofighters, with a remaining life of 15 to 18 years, are upgraded in batches of 12, factoring in an assumed availability number (of 0.65 to 0.85), I calculate as follows:

(53 - 12) x 0.65 = 26.65 fighters available
(53 -12) x 0.85 = 34.85 fighters available

That’s a secondhand buy that creates 4.5 to 5 years of MRO work for the local industry in Indonesia but it also means that the TNI AU has two squadrons (of between 27 to 35 aircraft) available for a 53 aircraft purchase, for the 1st 5 years. Hopefully, the TNI AU can form a 3rd squadron on the 6th year, after the 1st 48 aircraft that are in better condition, have undergone a MRO and are upgraded — with 5 to be cannibalized for spare parts and for engine swaps.

The original Eurofighter specification was 25 years and 6,000 flying hours for each new aircraft, but Eurofighter Typhoon will comfortably exceed that.

 

[Sandhi Yudha]

Both Eurofighters and F-16Vs are valid options that I support.

However, based on availability calculations below, I do not favour a Tranche 1 buy. Rather, I see advantage in a two squadron buy of new 32 F-16Vs (plus 4 spare engines) — this will give the TNI AU much more value for money, when we factor in pilot training costs, a simulator, operating costs and remaining air frame hours (a lifespan of up to 12,000 flight hours). This means it can remain service for 50 years.

38 + 15 = 53 Tranche 1

Assuming that these Eurofighters, with a remaining life of 15 to 18 years, are upgraded in batches of 12, factoring in an assumed availability number (of 0.65 to 0.85), I calculate as follows:

(53 - 12) x 0.65 = 26.65 fighters available
(53 -12) x 0.85 = 34.85 fighters available

That’s a secondhand buy that creates 4.5 to 5 years of MRO work for the local industry in Indonesia but it also means that the TNI AU has two squadrons (of between 27 to 35 aircraft) available for a 53 aircraft purchase, for the 1st 5 years. Hopefully, the TNI AU can form a 3rd squadron on the 6th year, after the 1st 50 aircraft have been locally upgraded.

The original Eurofighter specification was 25 years and 6,000 flying hours for each new aircraft, but Eurofighter Typhoon will comfortably exceed that.

The first aircraft delivered to Austria was in July 2007 and Germany's first EF2000s are slightly older with the first ones being delivered in 2003. But it seems that the filghthours of Austrias EF2000s are very low, and by October 2013, all Typhoons in service with Austria had been upgraded to the latest Tranche 1 standard.
( Eurofighter Typhoon | Austrian Eurofighters equipped with latest capability standard for Tranche 1 aircraft )
So i expect that an additional 25 years shouldn't be a problem.
From which i understand the EF2000 is only compatible with the AIM-120 starting from Tranche 2 Block 10, so an upgrade is necessary.

If the budget allows (not during this administration!) then 1 squadron of Austria's used ones and 2 squadrons of brandnew ones can be an option. The Hawks are not that old, so they can fly for at least 5 more years. The brandnew ones can be built under licence by IPTN, or just assembled with some additional parts manufacturing.

 

[tonnyc]

The first aircraft delivered to Austria was in July 2007 and Germany's first EF2000s are slightly older with the first ones being delivered in 2003. But it seems that the filghthours of Austrias EF2000s are very low, and by October 2013, all Typhoons in service with Austria had been upgraded to the latest Tranche 1 standard.
( Eurofighter Typhoon | Austrian Eurofighters equipped with latest capability standard for Tranche 1 aircraft )
So i expect that an additional 25 years shouldn't be a problem.
From which i understand the EF2000 is only compatible with the AIM-120 starting from Tranche 2 Block 10, so an upgrade is necessary.

If the budget allows (not during this administration!) then 1 squadron of Austria's used ones and 2 squadrons of brandnew ones can be an option. The Hawks are not that old, so they can fly for at least 5 more years. The brandnew ones can be built under licence by IPTN, or just assembled with some additional parts manufacturing.

I really hope the Ministry of Defense does not buy the Eurofighters. If they do, the EF2000s will be hangar queens even more than the Flankers. I don't doubt the EF has very low flight hours, but that's because Austria can't afford to fly them much and if Austria can't afford to fly them much, we'll be in even worse condition. It doesn't matter what the on-paper availability and capability looks like, if we can't afford to fly them (except for parade fly-bys) then what's the point?

 

[Ananda]

Both Eurofighters and F-16Vs are valid options that I support.

The brandnew ones can be built under licence by IPTN, or just assembled with some additional parts manufacturing.

Eurofighters are in the options simply due to the some thinking that insists on heavier fighters then F-16 and Political Factions that did pursue some kind of diversification of Air Force Fighters from depending on US ones only.

The idea of local upgrade and assembly in DI facilities is not new. It's part of Airbus pitching in 2015, in which Prabowo's predecessor choose Su-35 but only get up to preliminary contract.

If they do, the EF2000s will be hangar queens even more than the Flankers

If they only prepared the budget for for Procurement but not changes the calculation on operational support, yes they'll be potential on that. TNI-AU knows that, that's why they ask for F-16 both F-16V new ones or upgrade ones.

Doesn't matter for them, as their calculation on the operational support math still put F-16 as their back bone in operation. They put Su-35 to the Parliament only due to insistence of first term MinDef, but their own initiatives seems goes to F-16V. It's shown when LM come to shown F-16V platform demo's the AF brass shown much enthusiasm, but not Prabowo's predecessor.

If up to TNI-AU need, the project perhaps will go with 2 sq of F-16V and 2 sq of Refurbished F-16. The budget that being set asside for Su-35 and 32 F-16V potentially should be enough.

This talk of Su-35, Eurofighters or Rafale is just part of MinDef calculation and not TNI-AU. However in Indonesia what MinDef say is more often taking precedence than what the Armed Forces Branch's as users say.

 

[tonnyc]

Eurofighters are in the options simply due to the some thinking that insists on heavier fighters then F-16 and Political Factions that did pursue some kind of diversification of Air Force Fighters from depending on US ones only.

The idea of local upgrade and assembly in DI facilities is not new. It's part of Airbus pitching in 2015, in which Prabowo's predecessor choose Su-35 but only get up to preliminary contract.



If they only prepared the budget for for Procurement but not changes the calculation on operational support, yes they'll be potential on that. TNI-AU knows that, that's why they ask for F-16 both F-16V new ones or upgrade ones.

Doesn't matter for them, as their calculation on the operational support math still put F-16 as their back bone in operation. They put Su-35 to the Parliament only due to insistence of first term MinDef, but their own initiatives seems goes to F-16V. It's shown when LM come to shown F-16V platform demo's the AF brass shown much enthusiasm, but not Prabowo's predecessor.

If up to TNI-AU need, the project perhaps will go with 2 sq of F-16V and 2 sq of Refurbished F-16. The budget that being set asside for Su-35 and 32 F-16V potentially should be enough.

This talk of Su-35, Eurofighters or Rafale is just part of MinDef calculation and not TNI-AU. However in Indonesia what MinDef say is more often taking precedence than what the Armed Forces Branch's as users say.

We are not Austria who can rely on NATO to cover their air defense though. There is no such defense treaty supporting the TNI-AU and we are understrength to begin with, so we can't afford deadweight. As part of the international diplomatic game I can understand the need to give lip service to Eurofighters, but as far as actual readiness on the airfield? Eurofighter is a bad match for Indonesia.

Fundamentally I am still convinced that Prabowo is of the same mold as Ryacudu, the previous defense minister. An old army general who doesn't understand modern networked warfare and one whose mindset regarding air warfare is shaped by the movie Top Gun. He can still prove me wrong, and goodness I hope he will, because we have little leeway for waste. This isn't just some jeep purchase where if we don't like it we can just shrug, absorb the loss, and get something else. EF's maintenance cost, even when it's not flying, can be a drain on resources for decades. Austria wanted to retire their Typhoons precisely because of that, after all.

 

[Ananda]

He can still prove me wrong, and goodness I hope he will, because we have little leeway for waste.

Well it's not going to be difficult to see on that. If Prabowo's really goes with effective fighters fleet development tracks, he will foregone any ideas of Su-35, Eurofighters or Rafale and stick with what TNI-AU wants which is F-16. Thus he will not used up the budget for other types and focus to create effective fighters force within the limitations of resources that can be developed.

However I just to don't see that what will happen. Eventough Prabowo's can be persuaded to move on more focused Fighters force development, there's going to be pressure on him to diversify TNI-AU fighters from just one focus sources.
Just look on Medias and Forums that still full of so call analysts, political spoke person's, and enthusiasts that supports the idea.

Those crowds still supports the idea of 'cold war' postures and not network focus development.
Modern warfare idea that relied on more simplified fleets to make possible effective logistical and network support seems still not really get to their minds.

Thus the challenges not just convincing Prabowo's and 'army' veteran brass around him, but also Political factions around Jokowi's that being influence by analysts and whisperes on cold war era thinking.

 

[swerve]

I really hope the Ministry of Defense does not buy the Eurofighters. If they do, the EF2000s will be hangar queens even more than the Flankers. I don't doubt the EF has very low flight hours, but that's because Austria can't afford to fly them much and if Austria can't afford to fly them much, we'll be in even worse condition. It doesn't matter what the on-paper availability and capability looks like, if we can't afford to fly them (except for parade fly-bys) then what's the point?

Austria can afford to fly them. It's a very rich country with very healthy state finances (until COVID-19). It could afford much, much more. But it chooses not to. In the last decade it's spent between 0.7 & 0.8% of GDP on defence each year.

The Austrian air force can't afford to fly them, because it's not given enough money.

The Typhoon was the wrong choice for Austria. Gripen A would have been fine. Mirage 2000 would have been fine. Secondhand F-16 or Mirage F.1 or . . . . you get the picture. Austria needed (& needs) something which can catch up with straying civilian aircraft, just in case they're dangerous, & photograph USAF aircraft taking a short cut between Italy & Germany (I don't know if the USAF still does that, but it used to) to back up diplomatic protests. None of Austria's neighbours are going to attack it.

Having bought the wrong aircraft, Austria then got a defence minister (Norbert Darabos) who didn't think Austria needed any defences, & did his best to cripple the fighter fleet. One of his tactics was exaggerating costs.

Austria's Eurofighters can't be taken as a guide to Eurofighter costs or availability.

 

[tonnyc]

Austria can afford to fly them. It's a very rich country with very healthy state finances (until COVID-19). It could afford much, much more. But it chooses not to. In the last decade it's spent between 0.7 & 0.8% of GDP on defence each year.

The Austrian air force can't afford to fly them, because it's not given enough money.

The Typhoon was the wrong choice for Austria. Gripen A would have been fine. Mirage 2000 would have been fine. Secondhand F-16 or Mirage F.1 or . . . . you get the picture. Austria needed (& needs) something which can catch up with straying civilian aircraft, just in case they're dangerous, & photograph USAF aircraft taking a short cut between Italy & Germany (I don't know if the USAF still does that, but it used to) to back up diplomatic protests. None of Austria's neighbours are going to attack it.

Having bought the wrong aircraft, Austria then got a defence minister (Norbert Darabos) who didn't think Austria needed any defences, & did his best to cripple the fighter fleet. One of his tactics was exaggerating costs.

Austria's Eurofighters can't be taken as a guide to Eurofighter costs or availability.

Yes, that's a very good point. There's a big difference between not actually having the money and what Austria did.

Sadly in this matter we aren't that different from Austria. While Indonesia can afford the Eurofighters, the Indonesian Air Force can't afford them. Our defense budget IIRC is 0.7% GDP (2019 numbers, 2020 budget numbers is no longer relevant). and the air force gets about 13% of it. If next year defense gets, oh, say 1.5% GDP and air force gets 30% of that, I'll be ecstatic.

In real term the Indonesian Air Force gets about $1 billion per year. This may seem like a good sum, but our air force needs to cover over 5 million square km, about 70x the size of Austria or 2/3rds the size of Australia. So taking that into account, the air force is severely underfunded. Thank goodness our relationship with our neighbours has been peaceful for decades, but everyone who pays attention can see that regional stability in the upcoming decades will not be as certain as previously.

Nevertheless, the Indonesian Air Force as they are right now is severely underfunded. Getting Eurofighters as opposed to more second-hand F-16 or even second-hand Gripen Cs don't make sense. The only reason to do so is the false belief that Indonesia must have two kinds of everything sourced from two different blocks in order to avoid over-dependency on a single supplier.

 

[Sandhi Yudha]

Yes, that's a very good point. There's a big difference between not actually having the money and what Austria did.

Sadly in this matter we aren't that different from Austria. While Indonesia can afford the Eurofighters, the Indonesian Air Force can't afford them. Our defense budget IIRC is 0.7% GDP (2019 numbers, 2020 budget numbers is no longer relevant). and the air force gets about 13% of it. If next year defense gets, oh, say 1.5% GDP and air force gets 30% of that, I'll be ecstatic.

In real term the Indonesian Air Force gets about $1 billion per year. This may seem like a good sum, but our air force needs to cover over 5 million square km, about 70x the size of Austria or 2/3rds the size of Australia. So taking that into account, the air force is severely underfunded. Thank goodness our relationship with our neighbours has been peaceful for decades, but everyone who pays attention can see that regional stability in the upcoming decades will not be as certain as previously.

Nevertheless, the Indonesian Air Force as they are right now is severely underfunded. Getting Eurofighters as opposed to more second-hand F-16 or even second-hand Gripen Cs don't make sense. The only reason to do so is the false belief that Indonesia must have two kinds of everything sourced from two different blocks in order to avoid over-dependency on a single supplier.

0,7% of BNP/GDP is not just low, but pathically low.
Even 1,5 is quite low, many countries spend 2,0-2,5%, which shouldn't be a problem for a country like Indonesia. But its all because of the lack of political willingness.

"The only reason to do so is the false belief that Indonesia must have two kinds of everything sourced from two different blocks in order to avoid over-dependency on a single supplier."

Im sorry, but looking to the past, the US-embargo from 2000-2005 proves that these are not false believes.

 

[tonnyc]

"The only reason to do so is the false belief that Indonesia must have two kinds of everything sourced from two different blocks in order to avoid over-dependency on a single supplier."

Im sorry, but looking to the past, the US-embargo from 2000-2005 proves that these are not false believes.

It is. It is a misidentification of the problem which led to the wrong solution being picked.

Indonesia's problem is not a reliance on a single country as the provider of a specific defense items. Our problem is the lack of a comprehensive logistics system. Since the problem was misidentified, the solution won't apply.

Consider that we had no stockpile of difficult-to-make but storable items (e.g., turbofan engine parts, this is slightly better now in that we have a little bit of stored spare parts, but due to small budget, the stockpile is very little). We don't have the capability to make fast-consumable spare parts (e.g., seals and valves). Contrast Indonesia with Iran, who managed to keep their F-14 Tomcats flying (admittedly at a reduced rate) long after the US stopped making them and destroyed every other existing F-14s in order to deny spare parts. Contrast Indonesia with Vietnam, who got some Flanker spare part production going and made a local MRO depot by working with Ukraine despite Russian's anger over it.

The "two source countries for every defense item" policy also belies an implicit admission that we are not going to try to make ourselves so valuable to other countries that they can't afford to cut us off. Vietnam's cooperation with Ukraine angered Russia, but Russia can't afford to cut off Vietnam. So Vietnam's Flankers and Improved Kilos continue to operate.

 

[Ananda]

Indonesian defence minister proposes to receive USD20 billion in foreign credit for 2020–24

Indonesia’s Minister of Defence, Prabowo Subianto, has forwarded a proposal for the country to receive up to USD20 billion in defence-related foreign credit and...

www.janes.com

I put this couple months old news, since when informally I ask my colleagues in 'both' institution that handle government financing, they are 'unofficially' acknowledge that there's that request from MinDef on credit line for defense procurement.

As I have mentioned before, now Ministry of Finance and Bapenas demand every budget must be calculated on multi years disbursement until the project finish. Thus for capital goods like defense assets it's must include all the projects life time sustainment calculation.
Most of capital goods financing by Indonesian government projects usually use medium term financing at average 7 years tenure. In short if USD 20 bio credit allocation approved by Bapenas and Ministry of Finance, it means for next 7 years it will take up around USD 3.3 - 3.5 bio annually for credit repayment (depends on credit term they got).

This will take around 25% of average annual defense budget for next four years (end of Jokowi's term), which will be big if those credit lines did not calculate life time sustainment costs. For that, being heard for Fighters the budget being allocate are in the amount of Budget being allocated for Su-35 (around USD 1.2 bio) that already carry over from last term and fund allocate for F-16V which 'rumours' around USD 2.3 bio.

Thus, whatever the choice, whether Eurofighters, Rafale, Su-35, F-16V, F-16 Refurbished, or even FA-18 (as again favorite rumours now in local forums), it has to used that USD 3.5 bio budget or allocated credit lines and has to involved overall life time sustainment support as being calculate on multi-year allotment.

TNI-AU targeted their Fighters ORBAT to be 11 sq from current 8 sq in 2024. For that at minimum they have to add 4 sq (3 new and 1 F-5 replacement) with condition they're somehow manage to keep Hawk 200/100 fly at least for end of this decade.

For that if the amount allocate for Fighters is fix around that number, they can only realistically getting 2sq of 24 F-16V and 2 sq of Refurbished F-16 or new FA-50. Based on what various TNI-AU brass talk in Media, both F-16 and FA-50 are what they're talking. Since TNI-AU realistically know's with the best scenario on budget allocation they can get, getting their target ORBAT realistically can only be achieve by either F-16 or FA-50 or combination of both.

No Su-35, or Eurofighter, or Rafale in TNI-AU calculation. If somehow MinDef insist on adding one of those, TNI-AU will still in current number of Sq ORBAT as they have to retired at least one type (potentially Hawk 200/100) to be able maintain more expensive Fighters to sustain within the resources.

This's why in my previous post I put that if left only with TNI-AU plan, they will go with F-16 or combo FA-50 and F-16. There's no way the budget under current projection will able to go to 11 sq target, unless with those two type. Changes on that will hinder TNI-AU ORBAT growth, unless somehow the budget being double this next couple of years.

That something that no Indonesian administration after Soekarno and Soeharto era (the two beloved dictators) want to do.

 

[Ananda]

https://twitter.com/i/web/status/1328900283573780480

Twitter from Australian Reporters based in Jakarta. Quite interesting how he call Luhut as Minister for Everything. Other nick name for him are; King Maker, De Facto Prime Minister, The Grand Whisperes, and Man Behind the Throne.

Anyway on Procurement side, after Prabowo's meet with Pompeo, Pence to Jakarta and Now Luhut goes Washington, seems there're signs this Administration getting serious on defense procurement and co-op with Washington.

Wondering if he's going to meet Biden team later on, being heard he's also going to meet with Elon Musk for Tesla Battery investment in Indonesia.

His meeting in Washington also with Trump son in law and several Investment Bankers to gather market interest for Indonesia Sovereign Investment Funds.

Biden win raises doubts about Indonesia wealth fund - Asia Times

JAKARTA – US President-elect Joe Biden’s nail-biting election victory has injected new uncertainty into Indonesia’s ambitious plan to ignore the economic

asiatimes.com

This's shown how Indonesia try to diversify it's Investment source more. Coming from Luhut that use to try attract more Investment from China, this move seems shown that Indonesia did not want to relied too much with Chinese projects.

 

[Sandhi Yudha]

https://twitter.com/i/web/status/1328900283573780480

Twitter from Australian Reporters based in Jakarta. Quite interesting how he call Luhut as Minister for Everything. Other nick name for him are; King Maker, De Facto Prime Minister, The Grand Whisperes, and Man Behind the Throne.

Anyway on Procurement side, after Prabowo's meet with Pompeo, Pence to Jakarta and Now Luhut goes Washington, seems there're signs this Administration getting serious on defense procurement and co-op with Washington.

Wondering if he's going to meet Biden team later on, being heard he's also going to meet with Elon Musk for Tesla Battery investment in Indonesia.

His meeting in Washington also with Trump son in law and several Investment Bankers to gather market interest for Indonesia Sovereign Investment Funds.

Biden win raises doubts about Indonesia wealth fund - Asia Times

JAKARTA – US President-elect Joe Biden’s nail-biting election victory has injected new uncertainty into Indonesia’s ambitious plan to ignore the economic

asiatimes.com

This's shown how Indonesia try to diversify it's Investment source more. Coming from Luhut that use to try attract more Investment from China, this move seems shown that Indonesia did not want to relied too much with Chinese projects.

This article is still confusing for me (as expected from someone with a minimal financial knowledge). In the beginning of the article they talk about that Indonesia plans to borrow $5 billion from the US IDFC for the $5 billion Sovereign Wealth Funds. But later they say that it will come from Indonesia's own money.
(BTW, a Sovereign Wealth Funds, is that some kind of budget for investments?)

"Finance Minister Sri Mulyani Indrawati has said $2 billion of LPI’s seed money will come in the form of cash from the state budget and the remaining $3 billion from the sale of shares in SOEs (BUMNs) and other state assets."
This makes me really nervous..."selling states assets", something PDI-P is really good in, selling state assets and companies to get quickly easy money.

 

[Ananda]

Sovereign Wealth Funds is Fund Pool that being created for the need on Government Projects investment. In short Government raise money from it's own resources and pool it to attract other Investors on the pool.

Tell you the truth even in Financial circle, the detail on how the Government wants to Finance it are not really set yet. However in ball park Government will put their own money and leveraging it's assets including SOE assets and their projects. It's not similar with borrowings, since the Investors taking same risk on the Investment also. However it also provide some kind of guarantee return to Investors at the back of Government assets.

It's a way to get cheaper fund rather than borrowings to Banks or Financial Institutions. However not doing it properly, it can break your Economy especially Government resources. We can see that in Malaysia 1MBD. Thus the trick is to keep compliance assessment on where the money will go and what projects being pledge to the funds.

For that, The government try to work with Global Investment banks to make sure (at least in theory) level of compliance, disclosure and openness on the Fund Management as within Market practice.

In short, it will need full scrutiny from Parliament and Public to watch. Even if it's being manage and partner with reputable financial institution. That's from my perspective as a Finance Person. After all Sovereign Fund always has Political side need to be concerned, and Indonesia is not really can be said already "immune" on political miss manage

 

[ADMk2]

When you talk about ‘squadrons’ ie: aspirationally up to 11x Sqns, what size are you talking here? Does the TNI-AU use a set size for it’s fighter squadrons, as Australia nominally does at 18 aircraft per squadron (give or take usual availability)?

 

[tonnyc]

When you talk about ‘squadrons’ ie: aspirationally up to 11x Sqns, what size are you talking here? Does the TNI-AU use a set size for it’s fighter squadrons, as Australia nominally does at 18 aircraft per squadron (give or take usual availability)?

Indonesian Air Force does not have a set size for a squadron. Twelve is usually the minimum number for fighter aircraft but the air force prefers sixteen if possible. There are exceptions, e.g., recently the Flankers were divided into a squadron of 13 and a squadron of 3. I think the plan was to put the Su-35 into the smaller squadron but with the Su-35 in limbo, it's stuck at that current division for the near future.