Indonesia is reported to have big interest to acquire 14 second hand Mirage 2000 from Gulf nations.
If we indeed buy second hand 14 Mirage 2000 from two Gulf countries, so it means the plan intended to buy another 6-8 Rafale within Jokowi final term (2020-2024) will likely be converted to buy those 14 second hand Mirage 2000 where it could include the infrastructure and some weapons as as well. The weapon is likely similar with both Rafale and KF21 planes ( Meteor and IRIS-T)
I see by this decision, our planner will likely have focus on KF21/IFX program as those second hand Mirages will just fly for another 10-15 years. This mean this is kind of stop gap measure as we have ongoing KF21/IFX program which is so far progress as plan. Buying another 6-8 Rafale maybe is also not seen as enough as it likely to come without adequate weapons accompanying the order and also current situation to fill those F 5 squadron with some MRCA is so urgent to be done.
The soft loan maybe given by both Qatar and UAE. Bappenas only approve another 1.2 billion USD foreign loan backed MRCA program until Jokowi administration is over, they dont name what plane to use that foreign loan, so maybe the loan will be intended with these second hand Mirage 2000, plus weapon, training and possible the loan used on this Mirage order program much smaller than those 1.2 billion USD foreign loan approved already in blue book of our Planning Minister, despite it still needs another screening until the program is included in Green book, PSP, and finally there is RMP (budget allocation to start the program as down payment) from Finance Minister
Threat analysist
Any way, we are unlikely to face any kind of war for the next 20 years. China is not stupid and prefer play long game strategy, they are unlikely to assert their claim in SCS by force. Any way China understand SCS should be kept open for trade route and current status quo in SCS has bring peace that benefit China trade and economy.
Our disputed SCS region is also small and sit in the end of SCS, China will of course play divide and et empera if they some how decided to use force to assert their claim, it means they will target Vietnamese and Philippine first while they will play soft with Indonesia. China will likely want Indonesia as their friend either instead of enemy, due to our strategic location, future potential, and the fact that China is basically alone in SCS geopolitics.
China also depends on our coal despite they are the largest coal producers on earth, our nickel and our strategy to be world player in EV battery value chain can also make big country such as China prefer to be our friends rather than enemy. The benefit and loss calculation will likely expect China to prevent bad relationship to happen between our nations over such a small disputed region in SCS which is also farthest SCS region from mainland China.
China possible military action is Taiwan, not SCS, but with what happen with Russia Today with so many sanction on them by Western powers, China will think even more Today if they want to invade Taiwan since they still hold huge USD reserve in the form of US Treasury obligation that could be freeze by USA if they attack Taiwan. China's holdings of US Treasury bonds is 1.039 trillion USD at the end of March 2022.
CCP of China has also been known as very careful power for decades and has elites who wants current status quo to persist, either in SCS and also Taiwan, because once again I repeat my statement, that China is actually benefiting with current status quo on those disputed region. Changing that status quo can bring meaningful economic and geopolitics damage to China where economy is basically what current CCP has in order to preserve their domestic power within China.
The CCP party system is also unlikely to produce leader like Vladimir Putin that can prioritize something outside economy when he makes decision like current invasion on Ukraine. CCP is also power that not only understand economy is their strength to rule China, but also the organization system of the party will give much less possibility to produce Putin-like leader that can centralize power under his hand, CCP is more democratic in their party level system that will prevent one person to hold too much power as like what happen in Russia with Putin that can be called as supreme leader of Russia.
Local defense industry growth and sustainable defense spending
Because of that threat analysis, better we are more supportive on our economy and local defense industry. Focusing in economy means we will likely keep growing at 5-6 % until 2030 where in that rate our economy ( nominal GDP) is expected to reach 2 trillion USD in 2030. This double GDP number will double our defense spending as well without changing current policy to keep defense spending below 1 % of GDP (currently it is around 0.7 % of our GDP)
While by focusing on local defense industry means that in the time our defense spending is expected to be quite large beyond the year of 2030, hopefully majority of the armament order will come from our own local defense industry products. This then translate into more sustainable defense spending as large part of it will go to our own domestic economy in which with that larger market it can hopefully grow our big SOE defense holding and local subcomponent industry from both SOE and the private sectors as well
