Vedomosti newspaper in the material by Alexey Nikolsky "Indonesia has no money for French fighters. She refused cheaper Russian Su-35s under pressure from the United States," writes that the Indonesian Ministry of Defense does not have the funds to finance the agreement concluded with France in February 2022 on the acquisition of 42 Dassault Rafale fighters. This was reported by the CNBC Indonesia portal.Fighter Dassault Rafale (c) TNI The cost of deliveries under this agreement is estimated at $ 7 billion, excluding weapons.
Only the purchase of the first batch of six aircraft was formally funded in the amount of $ 1.1 billion from the budget of the Ministry of Defense of Indonesia in 2021. The country needs $5.9 billion in foreign loans to finance the rest of the Rafale procurement program, but the sources of such loans have not been identified. As a result, the contract with France has not yet entered into force and as of June 2022, the order for 42 Rafale for Indonesia was not listed in the order portfolio of Dassault Aviation, the portal reports.
Indonesia had previously planned to purchase Russian Su-35 fighter jets, and in 2018 a contract was signed for the supply of 11 vehicles worth $ 1.154 billion, of which about half ($570 million) was planned to be paid for by counter supplies of palm oil and other Indonesian goods. However, Indonesia subsequently refused the deal, citing financial difficulties. But, according to a source in the military-technical cooperation system, the main reason was the pressure on Indonesia from the United States, where by that time the anti-Russian sanctions law CAATSA had come into force, threatening secondary sanctions to buyers of Russian weapons.
Rafale is a very expensive fighter, says Ruslan Pukhov, a member of the Public Council under the Ministry of Defense of Russia. For small countries - buyers of these cars, such as Croatia or Greece, French sellers can provide a loan on good terms for their purchase. But in the case of large countries such as Indonesia, France does not have enough credit resources, he continues. In addition, Indonesia has a complex system of financing the military budget, and problems often arise with current payments, which aggravates the situation.
The Russian side, unlike the French, has always been ready for flexible terms of payment for its weapons by the Indonesians, the expert continues. Such readiness was shown both in the issue of possible payment of the contract for the Su-35, and when paying for earlier deliveries of Su-27 and Su-30 fighters, Pukhov recalls. At the same time, it was not about unprofitable deals for Russia: the same palm oil is a highly liquid and in-demand commodity, he recalls.
The story of the Indonesian Rafale did not arise yesterday and has a wide context, says Andrey Frolov, an expert of the Russian Council on International Affairs. The Indonesians wanted to use this contract to stop the French campaign against palm oil, which is declared unecological due to deforestation. They achieved their goal, but when the Su-35 dropped out of the game due to US pressure, and the Indonesians achieved their goals from France, the question arose whether they needed such an expensive aircraft, Frolov said. In addition, France, in the current economic situation, was hardly able to provide an extra-long loan from its export-import bank. All this created the prerequisites for Indonesia to try to abandon the deal under the pretext of financial difficulties, the expert says.
