President Prabowo Subianto has confirmed that he intervened to block the sale of state-owned defense enterprises to foreign buyers during his tenure as defense minister. Speaking at the inauguration of the Meninting Dam in West Lombok on July 10, the President stated that companies including PT PAL, PT Pindad, and PT DI were previously targeted for liquidation due to claims of poor profitability. These entities have since been consolidated under the Defend ID holding company, which was established in 2022.
Did You Know? The state-owned shipbuilder PT PAL Indonesia has transitioned from its historical focus on hospital ships to the construction of advanced combat vessels and submarines, including the KRI Alugoro-405 built in cooperation with South Korea’s Daewoo Shipbuilding & Marine Engineering.
International Defense Contracts and Production Growth
Under the Defend ID umbrella, domestic defense manufacturers have begun securing international contracts. President Prabowo noted that PT Pindad has secured a major contract to supply rifles and machine guns to the Saudi Arabian military.
In the maritime sector, PT PAL is currently executing a contract for two Scorpene-class submarines in partnership with France’s Naval Group. The companies held a steel-cutting ceremony for the project this July. These vessels are slated for full construction at the Surabaya shipyard, marking an increase in domestic fabrication capabilities for complex naval assets.
Expert Insight: Strategic Implications for State Assets
Future Outlook for Indonesia’s Defense Industry
With PT DI reportedly planning to sell NC-212i aircraft to Thailand and PT PAL constructing a landing dock warship for the Philippines, these companies are positioning themselves as regional suppliers.
Frequently Asked Questions
Which specific defense companies were targeted for sale?
According to President Prabowo, PT PAL, PT Pindad, and PT DI were among the companies previously slated for sale to foreign buyers.
What is the purpose of the Defend ID holding company?
Established in 2022, the holding company serves to consolidate Indonesia’s state-owned defense enterprises to foster growth and manage the development of national defense capabilities.
What international projects are currently underway for PT PAL?
PT PAL is currently in the physical fabrication phase for two Scorpene-class submarines in partnership with France’s Naval Group, alongside other projects such as the construction of a landing dock warship for the Philippines.
How do you believe the shift toward international defense exports will impact the domestic military’s own modernization efforts?
Worth a look
