Jakarta, IDM – This underinvestment arises from a widely held view among the policymakers and the general public that the security situation is relatively safe from potential international armed conflict. Thus, the budget priority is given to community development and social welfare improvement, as well as maintaining domestic stability. This is reflected in the country’s experience in the face of the 1998 Asian financial crisis, as well as various internal conflicts and separatist movements that almost divided the nation.
In the early years post-Reformasi, there was a focus on defense in order to maintain the stability of domestic security situation. However, since 2020, Indonesia has faced very serious regional security challenges, sparked by the US-China rivalry with potential implications on domestic stability.
However, constrained by the meagre defense budget for almost three decades, the Indonesian Armed Forces’ (TNI) posture is not yet ideal to deal with the prospect of an open conflict between two superpowers. The paradigm shift in viewing the development of defense forces as an urgent need to be well understood by both the Indonesian political elite and general public.
The appointment of Prabowo Subianto as defense minister in 2019 has prompted a paradigm shift that military and security developments are critical for the survival of a nation. The largest post-reform military modernization was marked by the purchase of 42 Rafale (F4-standard) jets worth US$8.1 billion from France, construction of two Red and-White frigates worth US$720 million, and the procurement other strategic equipment.
These breakthroughs have psychologically shattered the common consensus held by the political and bureaucratic elite who are resigned to the thought that Indonesia is financially incapable of building a large-scale military force.
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However, what Prabowo has done is still not enough. The nation needs to quickly narrow the military modernization gap that has been plagued by decades of underspending. Building capable and efficient defense forces is vital in preparing Indonesia for the prospect of hot war as the worst scenario of escalating rivalry between the US and China.
US-China relations are currently at a low points, marked by tense rhetoric on Taiwan reunification, territorial disputes in the South China Sea, as well as China’s de facto support for Russian invasion of Ukraine. China’s assertive – ness in challenging US hegemony, especially in the Asia Pacific region, is backed by its massive and impressive military buildup over the past 30 years.
Indonesia’s low defense budget, at 0.6-0.8 percent of GDP, has been a constant reality since Reformasi (1998). By comparison, the Organization for Economic Cooperation and Development (OECD) members allocate an average of 2 percent of GDP for military spending.
The People’s Liberation Army’s (PLA) Ground Force, the world’s largest army, has successfully transformed itself into a modern combat force, heavily mechanized with armored platforms, advanced electronic warfare capability, and cutting-edge weapon systems. Furthermore, the PLA Navy is projected to become the largest navy in the world in 2025 with 400 warships (versus the US Navy’s 287). This shift in balance of power will certainly in – crease the risk of armed clash.
Unlike during the Cold War, where the US-USSR rivalry took place on the distant European continent, today Indonesia is facing a potential conflict closer to home, in fact right in its own territorial waters the North Natuna Sea. There are two major scenarios in which Indonesia could be directly affected by the potential war.
Firstly, as an archipelagic state, sea lanes are crucial logistical arteries in facilitating economic activities in Indonesia. In the event of a closure of the Sea Lane of Communications (SLOC, locally abbreviated as ALKI), economic activities throughout Indonesia will effectively screech to a halt. The Bloomberg economic research team estimates that even a short war between the US and China could cause Indonesia’s economy to contract by 10 percent (twice as worse as when the Covid-19 pandemic hit in early 2020).
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This is under the assumption that international seaborne trade can be carried out under the short war scenario. It does not take into account for the paralysis of global trade flows due to the war, which would have been more destructive economically.
Apart from security threats to ALKI there are nearly 400,000 Indonesian citizens working in Taiwan. If the security situation in Taiwan Strait continues to worsen, the Indonesian government will be forced to evacuate its citizens. Even during peacetime this will be a daunting undertaking, let alone during a wartime. The geography of Taiwan, an island surrounded by the ocean, and its long distance from Indonesia, will make mass evacuation by ships and airplanes very complicated.
In the fog of war, these two modes of transportation are highly susceptible to stray missile hit. If this scenario comes to pass, it will be the largest civilian evacuation in the world, surpassing the evacuation of 340,000 Al – lied troops from Dunkirk during World War II. Therefore, it is no exaggeration to say that the potential US-China war is the biggest threat since the republic was founded.
In light of the threat, the political elite, media and society needs to adopt a new paradigm on military build – up. Military modernization through business-as-usual approach is no longer possible. It is paramount that we quickly scale up our defensive posture, in terms of quality and quantity of equipment, human resource development, and organizational agility and adaptability in the face of these threats. The political elite and society must stop being ignorant and complacent and be prepared to substantially increase Indonesia’s national defense budget in order to make a big leap in military modernization.