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Indonesia will not produce KF-21 locally

Indonesia will not produce KF-21 locally

Contrary to the original plan, Indonesia decided to procure the KF-21 Boramae directly from Korea rather than jointly produce it locally.

The long-standing conflict between South Korea and Indonesia over the KF-21 Boramae fighter jet program appears to have been resolved to some extent, with Jakarta confirming on June 29, 2026 that it would not jointly produce the fighter jet locally. Initially, the KF-21 was planned to be manufactured by Dirgantara Indonesia, a junior partner of Korea Aerospace Industries (KAI), but friction arose between the two countries over financial contributions, technology sharing, work sharing, and allegations of intellectual property theft.

There were signs of this outcome in 2025, when South Korea announced it would reduce Indonesia’s contribution to 600 billion won (about $389 million) after a series of disputes. This is a significant decrease from the 1.6 trillion won (about $1 billion) that Indonesia originally agreed to for the project, which is currently known to be worth 8.1 trillion won (about $5.3 billion).

But despite this, South Korea is likely to approve the transfer of one of the six KF-21 prototypes to Jakarta. This is in accordance with the February plan for ‘value transfer’ agreed with Indonesia, the Defense Acquisition Program Administration (DAPA) disclosed to the National Assembly’s Defense Committee in April.

According to Korea JoongAng IlboThe total amount transferred to the 5th prototype corresponds to Indonesia’s final contribution of 600 billion won. After conducting its first flight in May 2023, the fifth KF-21 prototype participated in AESA radar tests and aerial refueling tests.

The KF-21 has been developing steadily over the past few years, conducting pit drop tests of various air-to-ground weapons in December 2025 and completing flight tests by January 2026, ahead of schedule. KAI launched the first of 40 serial production aircraft in March 2026, and two weeks ago, the Defense Acquisition Program Administration granted the KF-21 and Initial Operational Certificate after the aircraft met all 745 inspection requirements across 14 airworthiness categories. This included airframe structure, weapons integration, and electronic systems.

Indonesia does not produce jets.

Indonesian Defense Ministry spokesman Rico Ricardo Sirait confirmed the development: jakarta globeFirst time reporting. “The government is adjusting the plans of the KF-21 Boramae program. We will no longer co-produce the fighter jets but adopt a direct procurement mechanism,” Sirait told the news outlet.

According to Searight, the government made a “comprehensive evaluation” of the KF-21 program, considering “program effectiveness, technology transfer, economic value, and domestic defense needs.” He also added that “Indonesia has not decided how many KF-21 fighter jets it will purchase under the new mechanism,” the Jakarta Globe added.

5th prototype moved to Indonesia

According to K.J.A.D.The transfer amount for the single-seater No. 5 prototype is approximately 350 billion won, which is part of Indonesia’s final contribution of 600 billion won. The overall package includes 174.2 billion won in technology transfer and 75.8 billion won in development and test data.

Since achieving its first flight in May 2023, the fifth prototype has been used to verify key avionics capabilities, including the active electronically scanned array radar, and to conduct aerial refueling tests.

Indonesia originally participated in the program on the condition that it cover approximately 20% of the KF-21 development costs. The amount was supposed to be around 1.6 trillion won, but a series of budget constraints and domestic economic conditions have delayed payment and there have been reports that Jakarta is seeking to renegotiate terms.

Afterwards, the Korean government lowered Indonesia’s contribution to 600 billion won, and as a result of the review, KJAD added, “We are also considering whether to transfer the prototype from the beginning.” In the end, Indonesia transferred 536 billion won out of the total 600 billion won, and according to the report, the remaining 64 billion won is scheduled to be paid by June.

KJAD said at the time, “The Defense Acquisition Program Administration plans to finalize the timing of transferring the prototype and development data once the full price is confirmed,” and added, “Apart from the value transfer process, Korea is continuing discussions with Indonesia to export 16 KF-21s.” It was reported that Indonesia later paid the full cost of 600 billion won and remitted the remaining 64 billion won.

KF-21 and Indonesia

In June 2025, Colonel Perel Rigonald of the Indonesian Air Force (TNI-AU) and Chief of Staff of the Polish Air Force Major General Iereneus Nowak flew the KF-21 Boramae for the first time. The Gen.4.5 jet is part of a 7.5 trillion won ($6.3 billion) collaboration between Seoul and Jakarta in 2014, with Jakarta putting in 20 percent of the development costs.

However, joint programs have led to differences in financial and industrial work sharing and technology transfer between the two countries. In 2018, Indonesia attempted to renegotiate its cost sharing and resumed payment in 2022.

Then, in 2024, two Indonesian engineers were accused of trying to steal the aircraft’s technical data on flash drives. A follow-up investigation by the Korea Defense Acquisition Program Administration, National Intelligence Service, and Counterintelligence Command confirmed that there was no theft of classified data, providing effective information to Indonesian engineers. Herald Co., Ltd. It has been reported.

The publication added that Jakarta has reservations on the scope of technology transfers, technological ‘no-possession’ and intellectual property (IP) rights. It is reported that this issue was discussed informally at a diplomatic level.

At this time KED Global On June 13, 2025, the Defense Acquisition Program Administration reported that it had agreed to reduce Indonesia’s contribution by ‘two-thirds’ to 600 billion won. This decrease is, KED Global Citing officials from the Defense Acquisition Program Administration and the Ministry of National Defense at the time, it was stated that it was conditioned on “transferring a smaller amount of technology to Jakarta than previously agreed upon.”

An agreement on this was signed at the India Defense Expo and Forum held in Jakarta. Now, as it turns out, the reduction in contribution quotas has eliminated entire industry coverage.

However, TNI-AU is still an effective Gen. 4.5 and Gen. It has 5 fleets. It will soon operate a fleet of 42 Dassault Rafales, the first of which has been delivered, and a contract has been signed with Turkish Aerospace Industries (TAI) for 48 KAAN fighter jets.

The Turkish fighter jet is expected to have significant local assembly and manufacturing rights. Indonesia has also abandoned plans to purchase the F-15EX and earmarked $9 billion for the Chinese J-10C, but the purchase has yet to materialize.

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