Indonesia restarts KF-21 repayments to South Korea

The KF-21 fighter aircraft (pictured above), which is being developed by South Korea and Indonesia, made its first flight in July 2022. Indonesia has restarted payments on the programme following a pause in 2019. (Korea Aerospace Industries)

Indonesia has restarted payments to South Korea for its involvement in the programme to develop the KF-21 Boramae multirole fighter aircraft, earlier known as the KF-X.

A source with knowledge of the matter told Janes on 3 November, “On 1 November, Indonesia paid part of the KF-X development cost. The amount is KRW9.41 billion (USD6.63 million).”

Janes understands that the KF-21 repayment – the first that Indonesia has made to South Korea in three years – follows several rounds of bilateral talks that concluded in November 2021.

South Korea's Defense Acquisition Program Administration (DAPA) has said that under this agreement, Indonesia will recommit to funding 20% of the KF-21 development costs till 2026, with about 30% of this contribution to be paid ‘in kind', meaning commodities and other goods. Details about repayments beyond 2026 have not been disclosed.

The original structure was agreed by South Korea and Indonesia in 2015. Under this deal, the two countries agreed to jointly invest KRW8.8 trillion (USD6.2 billion) to develop the KF-21, with Indonesia paying 20% of development costs in return for access to technologies, expertise, and options to buy the aircraft.

Under this structure, payments were scheduled to be made by Indonesia till 2028, but Jakarta ceased these in 2019.

Sources have earlier confirmed to Janes