While governments around the world are tightening their belts in response to ongoing economic volatility, other countries, particularly in Asia, continue to modernise their military forces.  The modernisation process in China has created a cottage industry of analysts devoted to assessing the efficacy of PLA anti-ship missiles, military aircraft development and PLAN moves to develop a blue water naval capability.

China, however, is not the only Asian nation which is currently developing its armed forces.  Indonesia, too, has announced both an increase in military spending and specific procurement objectives.

Indonesia is looking at obtaining some sophisticated equipment.  It is negotiations with the Netherlands to purchase Leopard tanks, of which the Dutch government has offered 150.  Jakarta is also purchasing six Su-30 Sukhoi fighters and looking to upgrade its F-16 fleet.  Perhaps its most ambitious purchase is its planned $1.1 billion acquisition of three diesel electric submarines from South Korea.

Such modernisation should, however, be put in context.  Even with recent budget increases, Indonesia’s budget has barely edged above 1% of GDP.  Indeed, should the Yudyohono administration’s goal of spending 1.5% of GDP on its military by 2015 be achieved, this will remain a slight slice of the national pie compared to that spent by its regional neighbours such as China, Singapore and Australia.

Indonesia, like many other Asian countries, is now investing in sophisticated platforms common in Western military inventories.  As Asia becomes richer, it is natural that it invests greater funds in military procurement.  This reflects the regional trend of moving from fielding primarily land-based forces to developing maritime and aerial capabilities.  In addition, while new toys such as submarines, fighter jets and tanks may grab headlines, a large proportion of military spending increases will be devoted to improved wages for servicemen and maintaining existing equipment.

An improved Indonesian military will also be more capable of contributing to public goods such as anti-piracy missions and drug interdiction.  That said, Indonesian military modernisation will raise some concerns in Canberra.  While the Australian-Indonesian relationship has improved remarkably over the last decade, Australia has often looked toward Indonesia as a potential threat.  Indonesia’s democratic transition has done a great deal to mitigate such suspicion, but while Jakarta remains an unconsolidated democracy, Canberra will continue to hedge its bets.

Canberra’s main focus is on protecting its maritime approaches.  As Indonesia develops its navy and airforce, its ability to project force toward Australia will increase and this will pose a challenge to the dominance of the ADF.  As a key ADF aim is to remain the most technologically sophisticated military in its neighbourhood, it will be interesting to see how Canberra reacts.

In many ways, however, both countries are natural defence partners.  Australia’s small army and sophisticated maritime and aerial forces complement Indonesia’s large army and rudimentary navy and air force.  In the event of any challenge from North Asia, the ADF could offer important support to a threatened Jakarta, while Australian analysts have argued that the Indonesian archipelago can be used as a shield against any attack on its northern approaches.

In conclusion, Jakarta’s recent moves to invest greater resources in its military should not be seen as a threat.  Rather, it promises to increase security in its neighbourhood.  Australia should continue to assist Indonesia’s economic and political development to ensure that Jakarta remains a force for stability in Southeast Asia.