Korea, Indonesia finalize deal to cut Jakarta's KF-21 contribution

Korea Herald

2 days ago

South Korea and Indonesia have finalized an agreement to set Jarkarta's contribution to the joint development of the KF-21 Boramae fighter jet at 600 billion won ($437 million), the Defense Acquisition Program Administration said Friday.
The agreement, signed during the Indo Defence exhibition in Jakarta earlier this week, follows more than a year of negotiations and delays surrounding payment terms and a diplomatic row over a technology leak.
Indonesia has so far paid around 400 billion won. The remaining 200 billion won is to be paid under a revised schedule that is still under discussion with KAI, the DAPA explained.
Indonesia initially joined the KF-21 program in 2016, agreeing to contribute around 1.7 trillion won — equivalent to 20 percent of the total development cost, according to DAPA — in exchange for technology transfer and co-development rights.
The figure was later adjusted to 1.6 trillion won, with payments originally due by June 2026.
In May 2023, Jakarta requested to reduce its contribution to 600 billion won and to accept a proportional reduction in technology transfer. It also asked to extend the payment deadline to 2034. Seoul also approved the poroposal later that year.
However, the agreement was delayed after several Indonesian engineers at Korea Aerospace Industries were caught in January 2023 attempting to take classified KF-21 data stored on USB devices offsite, prompting Indonesia to protest the investigation.
Tensions eased only after South Korean prosecutors cleared the engineers of charges and suspended prosecution on June 2.
According to DAPA, the scope of technology transfer has yet to be finalized and will be determined after the KF-21's development phase concludes.
Indonesia has also expressed interest in receiving a prototype aircraft, which may be negotiated in exchange for a further reduction in technology transfer.