South Korea’s Defense Acquisition Program Administration (DAPA) has hinted that it may accept Jakarta’s proposal to reduce its financial participation in the KF-21 “Boramae” fighter development program.
Originally, Indonesia had committed to cover 20% of the development costs of the KF-X program, in exchange for a prototype model, technology transfers and the rights to produce 48 units of the fighter in Indonesia. However, these commitments were not honored and South Korea had to move forward with the program almost single-handedly.
To date, Indonesia has contributed approximately $220 million to the project and has had difficulties in meeting scheduled payment deadlines.
In order to be able to stay in the program, Jakarta offered to pay approximately $442.3 million in total for the KF-21 fighter project, until 2026, which represents a large cut from the originally agreed $1.171 billion.
According to Korean media outlet Yonhap News, the new proposal could be accepted by Seoul, on the condition of providing fewer technology transfers.
“We are seeking measures to be taken in order to adjust the scale of technology transfers to Indonesia in accordance with the modified cost sharing,” Noh Ji-man, director general of the KF-X program group at DAPA, said at a press conference.
DAPA will seek to finalize its decision by the end of May, at the earliest, so as not to cause delays to the development project, which is scheduled for completion in 2026. If approved, the South Korean government and the aircraft’s manufacturer, Korea Aerospace Industries (KAI), will have to increase their financial burden to fill the gap. They will likely have to raise additional funds.
Jakarta’s proposal comes at a sensitive time, as an investigation is underway into an Indonesian engineer’s alleged attempt to steal the fighter’s technologies from the manufacturer’s headquarters. The suspect, an employee of PT Dirgantara Indonesia, was caught in January as he attempted to leave a KAI facility with a USB storage device, which contained data on the KF-21.
