Talks between Tokyo and Jakarta on the potential joint development and production of advanced frigates for the Indonesian Navy continue at the highest levels of government, the Southeast Asian nation’s envoy to Japan has said, as the two countries seek to deepen defense-industrial ties.
After Prime Minister Shigeru Ishiba and Defense Minister Gen Nakatani discussed the issue on separate visits to Jakarta earlier this year, the topic is also set to be high on the agenda when the Self-Defense Forces’ top uniformed officer, Chief of Staff Yoshihide Yoshida, visits Indonesia later this month, Ambassador Heri Akhmadi told The Japan Times in a recent interview.
Efforts to procure and co-produce a customized variant of Japan’s Mogami-class frigates — which Tokyo also hopes to export to Australia — remain a priority for the administration of Indonesian President Prabowo Subianto, Akhmadi said.
Prabowo, who is expected to visit Japan later this year, first expressed interest in cooperating with Japan on warship construction when he traveled to the country as defense minister in 2021 to sign a memorandum of cooperation on defense tech and equipment transfers.
Tokyo’s project proposal, reportedly valued at ¥300 billion, would involve building four of the frigates in Japan, with an equal number to be built in the Southeast Asian country by state-owned shipyard PT PAL to meet navy requirements.
However, talks stalled during the previous Indonesian administration due to the COVID-19 pandemic and financial constraints tied to Indonesia's ambitious project to relocate its capital.
While Tokyo has reportedly already offered loans, the funding issue has yet to be resolved as Indonesian regulations require the government to provide 10% to 20% of the funds up front.
Nevertheless, Akhmadi points to growing momentum in the negotiations under Prabowo, particularly as Japan has been relaxing its strict defense export controls in recent years, in part to allow for the potential sale of customized, upgraded Mogami frigates to Australia.
The ambassador said another key aspect of negotiations revolves around defense technology transfer. Jakarta is interested not just in jointly developing and producing the vessels, but also in gaining access to the Japanese technologies used in several of the systems on the Mogami-class vessels, which are among the most advanced in the Maritime Self-Defense Force.
“Given our increasingly close connections to Japan, we would also like to work closer together on such systems through technology transfers,” the diplomat said.
As an example of such cooperation, Akhmadi cited India’s agreement with Tokyo last year to co-develop a radar system for Indian Navy warships based on the Japan-made Unified Complex Radio Antenna. The cutting-edge radar antennas are being installed on some Mogami-class frigates.
Experts say this kind of cooperation would support Japan’s efforts to grow its domestic defense industry through global exports. At the same time, it would align with Indonesia’s offset policies and long-term goals of building up its own defense sector, as Jakarta looks to reduce its reliance on foreign-made military equipment.
That said, Indonesia’s decisions will also hinge on interoperability and workforce factors, particularly as the country has already placed orders for several other naval assets from European partners.
But the growing security ties already go far beyond potential frigate cooperation.
Ishiba’s first overseas trip aside from international conferences was to Southeast Asia — specifically Malaysia and Indonesia — in January.
While these countries have long pursued a foreign policy based on nonalignment, the visits signaled Tokyo’s continued commitment to the strategically important region as it looks to both hedge against growing global economic volatility and create a more favorable security environment.
Akhmadi said that energy and maritime security were among the main topics discussed during Prabowo’s January meeting with Ishiba. This, he added, also led to talks on other potential exchanges, including the possibility of Tokyo providing decommissioned Soryu-class submarines to Jakarta.
Although Indonesia is not one of the claimant states in the long-running South China Sea disputes, it has had skirmishes with Chinese vessels over the resource-rich waters around the Natuna Islands.
Tokyo has been helping Jakarta improve fishing ports as well as its coast guard and naval patrol capabilities through joint training and the supply of ships, including two new high-speed patrol boats to be delivered to the Indonesian Navy under Japan’s new military aid program.
The countries have also been intensifying joint military exercises, with Akhmadi noting that this year’s iteration of the multinational Super Garuda Shield drills will see the SDF make its largest contribution to date, with over 250 personnel and a warship.
Tokyo and Jakarta have also agreed to hold a third round of "two-plus-two" talks between their foreign and defense ministers later this year.
At the same time, strengthening economic cooperation with Southeast Asia remains one of Japan’s top priorities amid growing competition with China. Ishiba in January highlighted Indonesia’s role as central to this push.
“Energy and economic security play an increasingly important role in this regard,“ Akhmadi said.
Jakarta has agreed to continue supplying liquefied natural gas to Japan while Tokyo will keep supporting Indonesia’s Abadi LNG development project, which is slated to start production around 2029 or 2030 with assistance from Inpex, Japan's biggest oil and gas explorer.
Jakarta and Tokyo are also in the final stages of negotiating a critical minerals deal, the ambassador said. The envisaged pact would include the exploration, development, production, refining and processing in Indonesia of critical minerals such as nickel, aiming to boost battery production and diversify supply chains.
“With China controlling the majority of lithium processing worldwide, we would like to see more Japanese investments in the production of critical minerals in Indonesia,” the ambassador said.
The deal is expected to be signed “in the near future,” he added, and would be more comprehensive than the one signed between Japan and Canada in 2023.
To strike a balance amid the great-power competition between the United States and China, Indonesia and Malaysia were among four Southeast Asian nations — along with Vietnam and Thailand — that agreed to join BRICS last year, a group of emerging economies that seeks to provide an alternative model to the Western-led Group of Seven. Indonesia formally joined as a full member in January while Malaysia, Thailand and Vietnam now hold the status of partner countries.
Akhmadi said Jakarta’s growing ties with Tokyo reflect its nonalignment policy, as it looks to broaden its partnerships and avoid taking sides in the escalating rivalry between China and the United States.
“Indonesia would especially like to work closer together with middle powers such as Japan and India,” the ambassador noted.
“Working with superpowers means you may have less leverage in negotiations, but if the middle powers cooperate more closely, it will be more equal and we can do much more to maintain regional stability and increase our prosperity.”
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