Indonesian Defence Ministry has signed documents concerning the purchase of 11 Su-35 fighter jets while the Trade and Finance Ministries are still in the process of approval, Defense Minister Ryamizard Ryacudu was quoted as saying by TASS on Sunday.
The need for approval from multiple ministries was connected with the fact that “there will be different forms of payment,” he explained. The minister’s statement could be interpreted to mean that negotiations are in the direction of a possible barter trade. Jakarta has insisted on a combination of hard currency and barter trade against purchase of the jets. The latter means Russia buys palm oil and a few other natural products produced in Indonesia. Earlier reports had said that barter trade could form over 50% of the price of the jets, said to be $8 billion.
This is the clearest indication as yet that the purchase of the fighter jets is on track and has progressed beyond negotiations in recent months. Earlier there were reports that the Jakarta might be having second thoughts in the light of the United States’ threat to impose sanctions against countries buying Russian military equipment.
A top Russian official, Victor Kladov, Rostec’s director for international cooperation and regional policy had said in March that the procurement of the Su-35 jets had been on hold till the Indonesian elections and that the process would pick up steam after a new government was in place. “The barter trade for military equipment was proving to be a win-win deal for both countries,” he had said during the LIMA event in Malaysia.