China Floats Submarine Offer to Indonesia as Geopolitical Calculations Weigh
Indonesia is expected to be lukewarm on military deals with China given its extensive defence partnerships with the West, analysts say.
China is seeking to bolster underdeveloped defence ties with Indonesia through a submarine offer, according to observers, who say that Jakarta is expected to be lukewarm in expanding the relationship amid geopolitical tensions and strategic challenges in the region.
Representatives from the China State Shipbuilding Corporation (CSSC) have been travelling to Jakarta in recent months, with the latest reported visit on July 4, to offer Indonesia’s defence ministry S26T diesel-electric submarines (SSK) and guided-missile destroyers at a discounted price.
The ministry was quoted in local media as confirming the submarine offer but said the process was still at the “proposal stage”.
The visits by the CSSC executives came after the Asia-Pacific Defence Journal reported that the Indonesian navy was said to have shown interest in January in procuring a Chinese-made YJ-12E coastal missile system.
If confirmed, the purchases would align with the third stage of Indonesia’s Minimum Essential Force plan (MEF), a blueprint outlined in 2009 to modernise the country’s ageing military hardware.
Despite China’s offer of new submarines and other defence equipment, Indonesia has been “lukewarm” in its interest in developing a defence-industrial partnership with Beijing even though the two countries established a strategic partnership in 2005, analysts say.
These new procurements, if confirmed, would mark a shift in Indonesia’s defence relations with China, particularly as Jakarta has previously only acquired minor equipment from Beijing, said Anastasia Febiola, a research coordinator and manager of consultancy firm Semar Sentinel Indonesia.
Thus far, Indonesia has procured C-705 and C-802 anti-ship missiles, uninhabited aerial vehicles and self- propelled air defence systems from China. According to the International Institute for Strategic Studies, these recent defence procurement programmes with China represented a mere 0.09 per cent of the total US$30 billion worth of defence-import deals signed by Jakarta since 2014.
“But this time China’s offer is a submarine, which is a major weapons system,” Anastasia said. The offer was an interesting development as Indonesia had just signed a US$2 billion contract with French manufacturer Naval Group for two new submarines, she added.
Whether a China defence deal would be confirmed could signal a “shift in momentum” in Indonesia’s patchy security ties with China, according to Anastasia.
In addition to the recent submarine deal with France, Indonesia sources its military weapons primarily from Italy, Sweden, Belgium, the United States and South Korea. Indonesia has made efforts to diversify its defence imports to avoid overreliance on any single supplier, Anastasia said.
Natalie Sambhi, executive director of independent think tank Verve Research and a lecturer at Deakin University, Australian War College, said Indonesian defence and military decision-makers typically preferred advanced American and European weaponry despite their higher prices.
Natalie pointed out that during president-elect Prabowo Subianto’s tenure as defence minister since November 2019, he showed a preference for such weapon systems, particularly French-made fighter jets and submarines.
To incorporate the new Chinese submarines into Indonesia’s weapons portfolio could present challenges, analysts say, particularly with interoperability between the different national platforms.
“Adding another national supplier to a sub-surface fleet already composed of German and Korean submarines and, in the future, French submarines [could result in] increasing the costs to crew, operate and maintain,” Natalie said.
There was also the question of quality regarding the Chinese submarines on offer, said Anastasia, noting the French-built Scorpene Evolved submarines have significantly greater range and endurance compared with the Chinese SSK models.
Defence ties between Indonesia and China were non-existent during the New Order era under the anti- communist Suharto regime when Indonesia froze diplomatic relations with China from 1967 to 1990, analysts say.
Indonesia’s military has deep ties with the West, with generations of Indonesian personnel training with their American counterparts and attending US-based military schools and exchange programmes, Natalie said.
“Owing to the New Order’s deliberate lean away from China, the Indonesian military has not enjoyed the same level of interaction with the People’s Liberation Army,” she added.
Yokie Rahmad Isjchwansyah, a research fellow at the Center for Intermestic and Diplomatic Engagement at Paramadina Graduate School of Diplomacy in Jakarta, noted the lack of Indonesia-China joint military exercises, with only four such drills taking place from 2003 to 2022. In contrast, Indonesia held a total of 110 such drills with its American counterparts over the period.
“Indonesia lacks confidence in the quality of Chinese defence equipment and still doubts the added value of conducting joint exercises and sending soldiers to study in China,” he added.
Geopolitical balance
For China, fostering closer defence ties with Indonesia could offer an opportunity to exert influence in the Indo-Pacific region, analysts say, something that might weigh on the minds of Indonesian policymakers.
Despite China being a major economic partner, Indonesia views its defence ties with the West as vital, according to Anastasia. While Jakarta may entertain Chinese offers for military equipment to placate Beijing, it is expected to continue prioritising security cooperation with the West.
“The middle ground that the government has been trying to implement is that for the defence sector, it might choose the West, and for the economic partnership, the government is fine to go with China,” Anastasia said.
One key determinant of defence equipment spending is maritime disputes in the region, which could spur Indonesia and other Southeast Asian nations to boost their local manufacturing capabilities, analysts say.
Indonesia in 2023 issued a joint statement with the US over Beijing’s South China Sea claims while its military is wary of China’s incursions in the waters around Natuna Islands.
Though China accepts the Natuna Islands belong to Indonesia, its “nine-dash line” overlaps with Indonesia’s exclusive economic zone, leading to past standoffs between the countries.
Since 2020, China’s coastguard and fishing vessels have increasingly encroached on Indonesia’s sovereignty in the waters north of Natuna Islands, Anastasia said, which may be why the government might be “lukewarm” to Chinese offers in the defence sector.
While China’s “aggressive actions” in the South China Sea may influence regional perceptions of defence ties with Beijing, its Indonesian and other partners would ultimately weigh the costs and benefits in determining the extent of bilateral cooperation, Natalie said.
“In countries such as Cambodia and Laos, Beijing has greater potential to work more closely with the armed forces and defence sector but several other Southeast Asian states share Indonesia’s preference for engaging a multitude of players.”
Outlook under Prabowo
With Prabowo’s ascendancy to the presidency in October, he is expected to prioritise the military modernisation programme he had championed as defence minister, according to analysts. However, the programme has been lagging so far, with the air force, the navy and the army attaining only 51 per cent, 76 per cent and 60 per cent of their targets by the end of 2023, respectively, analysts say.
Prabowo has pitched a US$125 billion, 25-year plan to expand Indonesia’s military capabilities, with support from the finance ministry in the form of US$25 billion foreign loans since 2020.
During a visit to Indonesia in April, Chinese Foreign Minister Wang Yi had a closed-door meeting with Prabowo where they reportedly discussed bilateral defence ties.
In March, less than a month after his election victory, Prabowo visited Beijing where he met his counterpart Dong Jun, President Xi Jinping and Premier Li Qiang.
While the high-level defence exchanges between Indonesia and China suggest efforts to strengthen bilateral ties, experts say these may be more symbolic than indicative of major shifts in Jakarta’s defence policy.
Ultimately, analysts anticipate Indonesia’s close defence cooperation with Western partners will continue under Prabowo.
However, Prabowo could be “unpredictable” in his policies and much would depend on how Indonesia navigates the region’s shifting geopolitical landscape and the US-China rivalry, Anastasia said.
