PM A/S HILLEN'S POLITICAL-MILITARY TALKS IN JAKARTA

C O N F I D E N T I A L SECTION 01 OF 04 JAKARTA 013170

SIPDIS

SIPDIS

DEPARTMENT FOR PM/RSAT, EAP/MTS, EAP/RSP

E.O. 12958: DECL: 11/09/2016
TAGS: MARR PREL PGOV MNUC RI
SUBJECT: PM A/S HILLEN'S POLITICAL-MILITARY TALKS IN JAKARTA

Classified By: Ambassador B. Lynn Pascoe, for reasons 1.4 (b, d).


1. (C) Summary: Assistant Secretary for Political-Military
Affairs John Hillen discussed a range of political-military
issues with Indonesian Minister of Defense Sudarsono, Foreign
Affairs Director General Hariyadhi and other public leaders
in Jakarta on November 7. The discussions built on similar
talks in February, 2006 and emphasized the need to give
concrete expression to the maturing bilateral relationship in
the form of agreements and other mechanisms for cooperation.
Key topics were defense reform, a Status of Forces Agreement
(SOFA),the Proliferation Security Initiative (PSI),
Indonesia's UNIFIL deployment, the Global Peace Operations
Initiative (GPOI) and the Defense Reform Management Study
(DRMS). The Indonesians expressed support for increased
bilateral political-military cooperation and welcomed further
discussion on most of the agenda issues. Sudarsono
underscored Indonesia's limited economic means for military
development and its priority on disaster relief. A lengthy
exchange on PSI with Foreign Affairs interlocutors elicited
renewed statements of common interest but persisting
reservations over its compatibility with the United Nations
Law of the Sea (UNCLOS). End summary.


DEFENSE MINISTER SUDARSONO: DISASTER RELIEF, SLOW GROWTH


2. (C) In a meeting at the Department of Defense (DEPHAN),
Defense Minister Juwono Sudarsono expressed appreciation for
the lifting of the U.S. "embargo" on cooperation with the
Indonesian military (TNI). This was allowing the TNI to
rebuild its capabilities. For the immediate future, however,
the emphasis would be on developing non-strike capabilities.
Hillen said the embargo should be seen as an aberration,
whereas now U.S.-Indonesian relations were becoming more
normal. It was important to demonstrate progress in order to
maintain the support of respective publics. The conclusion
of a Status of Forces Agreement (SOFA) and an Article 98
agreement as well as Indonesian accession to the
Proliferation Security Initiative (PSI) would provide
concrete evidence of trust, good faith and a mutual
commitment between the two countries. Hillen concurred that
strike capabilities were less important for Indonesia at this
time than counter-proliferation, counter-terrorism, maritime
security, humanitarian assistance and disaster relief. Many
of these challenges were transnational or even regional in
scope, and bilateral military cooperation would increase
regional capabilities to address them.


3. (C) On military reform, Sudarsono said a priority was to
redesign the responsibilities of the TNI in Indonesia's
provinces, i.e. modify the traditional "territorial system"
inherited from the past, but this would require time. Only a
third of Indonesia's provinces had sufficient civilian cadres
to meet local needs in public services such as disaster
relief, schools and so forth. Because civilian resources
were still weak, there was still a real need for TNI
involvement in local communities. Sudarsono predicted the
next 15 years would see considerable popular unrest if
economic development did not keep pace with heightened
expectations. Half of the country's population remained
below the poverty line, and this had to be factored into the
equation military reform and expenditures. Hillen pointed
out that military cooperation offered a broad range of U.S.
tools and resources which could help Indonesia to address
these problems.

...UNIFIL AND PEACEKEEPING TRAINING


4. (C) Regarding Indonesia's participation in the United
Nations Forces in Lebanon (UNIFIL) and Indonesia's plans to
develop a regular cadre of peacekeeping forces, Sudarsono
noted that Indonesia historically had contributed PKO troops.
UNIFIL would be Indonesia's first multilateral involvement
in a hostile situation, however. Hillen emphasized UNIFIL's
objective was to secure southern Lebanon but also to
facilitate the transition to Lebanese state control of its
own territory. Hizbollah was a significant force and had to
be disarmed. The disarmament and integration of Hizbollah
was the job of the Lebanese forces, but this would take time
and would not be easy. Lebanon's military must be
strengthened to restore security to the country. The United
States was committing substantial assistance to the reform of
the Lebanese armed forces. Sudarsono said the Indonesian
contingent would be deployed in eastern Lebanon along the

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blue line, in the Sheba Farms vicinity, but lacked a demining
capability. Noting that USG had worked to overcome Israeli
resistance to Indonesian participation in UNIFIL and to find
funding to transport Indonesian forces to Lebanon, Hillen
said the United States could also help Indonesia on demining
through the UN Mine Action Program. Indonesia's presence in
Lebanon marked a quick and significant return on the PKO
training the U.S. military had given Indonesia earlier in the
year.


5. (C) Sudarsono said he hoped the UNIFIL experience and
further PKO training would produce a standing reserve trained
and equipped for PKO deployment. These forces could also if
necessary be deployed in Papua, central Sulawesi and other
areas of ethnic conflict within Indonesia. The Indonesian
military was still needed domestically, and President
Yudhoyono was committed to this strategy. In so doing, the
TNI would support the development of democracy. Economic
development would be essential, however, for this to succeed.
Over three quarters of Indonesia's poor were Muslims, and
raising the welfare of the people would reduce Islamic
radicalism.

... MILITARY BUDGET


6. (C) Responding to reports that the Indonesian state
military budget was increasing 15-20 percent per year,
Sudarsono said the TNI's divestiture of its business
operations was supposed to be completed by 2009. He
stressed, however, that of the 1500 or so business operations
owned or operated by the TNI, the vast majority involved
local cooperatives and only six or seven had a value of over
$50,000. These few would be taken over by the Department for
State Enterprises by 2008. The rest would be required to
comply with regulations for profit-making organizations. For
the next five years, the military expected to meet only half
of its basic needs through central budgeting, while the rest
would have to come from local support. However, the "big
octopus" of TNI business operations of the past was gone.


7. (C) On next steps in bilateral military-to-military
cooperation, Sudarsono noted that the $12 million in
U.S.-donated medical equipment and supplies had been
distributed to local hospitals in Indonesia, civilian as well
as military. He said any field-hospital and other basic
equipment, including things as simple as mosquito netting,
would be useful.


8. (C) Hillen described the U.S. response to the coup in
Thailand as restrained but making clear that the country
needed to return to democracy before normal military
cooperation could be resumed. Sudarsono commented that Prime
Minister Thaksin had tried to be more popular than the king
and that this was a good lesson for the Indonesian military.
The U.S. response had been the correct one and had sent the
right message, but the United States should also welcome
transitional steps on the road back to democracy. The Thai
public must respond to make this transition succeed. Thai
society was sufficiently wealthy and ethnically homogeneous
to allow the country to recover quickly.


LUNCHEON WITH PUBLIC LEADERS


9. (C) In a luncheon discussion with experts, editors,
legislative deputies and government officials, A/S Hillen
stressed Washington's positive view of the developing
military-to-military relationship and appealed for their
active engagement to shape the bilateral relationship. It
was important to maintain public support for
counter-terrorism, nonproliferation, maritime security and
disaster relief. Regional rivalries based on number and
sophistication of military hardware were counterproductive
and a legacy of the past and should give way to regional
cooperation on common challenges. It was important to show
progress in order to maintain public support for cooperation.


10. (C) Secretary General Imron Cotan from the Department of
Foreign Affairs (DEPLU) said Indonesia had turned to Russia
for military equipment because of the U.S. embargo and Russia
continued to offer attractive terms. However, most of
Indonesia's existing equipment was still U.S. and so it was
natural to look again to the United States for future
equipment procurement. Cotan and Commission I Chairman Theo
Sambuaga of the National Legislature (DPR) highlighted the

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current DPR debate over whether civilian law enforcement
officials and civilian courts should have legal jurisdiction
over military personnel. Sambuaga also stressed the need to
eliminate illegal business dealings within the military
which, he asserted, mainly benefited senior officers, set a
bad example for the rank and file and undermined morale.
Although budgetary means were still limited, the DPR and
DEPHAN were working to raise military salaries to reduce
incentives for corruption. National Employers Association
Board Chairman Sofyan Wanandi said the number of viable TNI
businesses was very small, while Tempo Magazine
Editor-in-Chief Bambang Harymurti pointed out that TNI assets
in some cases included schools, hospitals and other public
facilities, some of which were very lucrative but represented
a significant sum in terms of compensation if the TNI were to
turn them over. Cotan said Indonesia's UNIFIL deployment was
for the duration of the mission. Hillen stressed that the
UNIFIL mandate was a chapter 7 mandate in everything but name
and that UNIFIL troops would be expected to take action
against violations.


DEPARTMENT OF FOREIGN AFFAIRS ROUNDTABLE


11. (C) In the main discussion with the Department of Foreign
Affairs (DEPLU),A/S Hillen said the bilateral
political-military relationship was doing well. It should
become strong enough that small incidents would not sidetrack
it. The new security environment of non-traditional,
transnational threats provided a focus for common interests,
including nonproliferation, counter-terrorism, maritime
security and disaster relief.

... STATUS OF FORCES AGREEMENT (SOFA)


12. (C) DEPLU Director General for Europe and the Americas
Eddy Hariyadhi cited recent talks on a Status of Forces
Agreement (SOFA) as a sign of progress in the relationship.
He had had a productive exchange with Ambassador Loftis in
early October and had ended by leaving the door open to
further talks. Hillen said conclusion of a SOFA would send a
strong signal of bilateral progress. The United States had
such arrangements with most of its friends and allies and it
could be considered a pedigree for a serious relationship. A
SOFA would anchor the relationship, providing stability when
incidents occurred, but also would facilitate quicker
responses when prompt action was needed.


13. (C) Hillen described continued Indonesian military reform
as a pacing mechanism which provided the measure for
political-military cooperation. On strengthening civilian
authority, Hariyadhi said Indonesia had adopted a one-door
policy of military procurement in July, 2006 requiring DEPHAN
approval of all military purchases. Hillen stressed the
importance of the Defense Resource Management Study (DRMS)
and the need to move forward with it. Ambassador Pascoe and
Embassy Security Assistance Officer Col. Ken Comer explained
the importance of U.S. licensing requirements and noted that
in most cases problems arose from improperly completed
applications and did not represent a denial. USG had
conducted training sessions for Indonesian defense officials
in purchasing under the Foreign Military Sales (FMS) and
other assistance programs, and would continue to offer these
to ensure continuity of DEPHAN institutional knowledge of the
process.

... UNIFIL DEPLOYMENT


14. (C) On Indonesia's deployment of a peacekeeping
contingent for UNIFIL in Lebanon, Hillen underscored the
mission's purpose was to support UN Security Council
Resolutions 1559 and 1701, both of which had been passed
unanimously, and UNSCR 1701 in particular was designed to end
Hizbollah's status as a separate armed entity. Some
Hizbollah elements would resist this move, and UNIFIL troops
should be prepared to enforce their mandate. This was
important for restoring Lebanese sovereignty and stability
and dialogue in the Middle East but also for containing
Iran's influence in Lebanon. Muslims throughout the world
wanted peace in the Middle East and the United States was
working to restore dialogue between Israel and the
Palestinians. The United States welcomed the opportunity to
assist Indonesia's deployment. Indonesian Acting Deputy
Director for International Security Yonatri Dilmania thanked
USG for its assistance.

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... PROLIFERATION SECURITY INITIATIVE (PSI)


15. (C) Iran's nuclear program presented a second security
threat, Hillen said, which was destabilizing for the Middle
East and beyond. Once Iran had nuclear weapons, Saudi Arabia
and other Arab nations might seek them, too, and the world
could expect to see new nuclear weapons states in the next
decade. This was not in the interest of either the United
States or Indonesia. The Proliferation Security Initiative
(PSI) was an effective mechanism for containing Iran's
ambitions as well as other types of proliferation. The
Iranian and North Korean nuclear programs would likely
dominate the UN Security Council agenda during Indonesia's
tenure on it. Indonesia should consider this as it framed
its UNSC strategy and consider what it could do to help stop
proliferation now. Joining PSI was one way to accomplish
this. Ambassador Pascoe added that the Indonesian proposal
for a "bilateral PSI" was ill-defined and that the
international community needed to be able to take concerted
and quick action against defined proliferators. Indonesia
would soon have the radars necessary to assist in this effort
in the Strait of Malacca. U.S. objectives were to strengthen
the control of Indonesia and its neighbors over the
international waters in the region. Deputy Director for
Regional Security and Arms Transfers Henry Tucker suggested
that if Indonesia could not sign on now to PSI, at least it
could publicly endorse PSI principles and announce its
intention to enforce its territorial sovereignty in respect
to illicit transport. Accession did not obligate Indonesia
to act if it did not wish to.


16. (C) Hariyadhi said Indonesia shared U.S. concerns on
substance but had reservations about interdiction. Hillen
said the two sides should continue to explore options but
keep a full PSI on the table as one of them. The
effectiveness of the initiative was growing exponentially
with every new member, and Indonesia's accession as the
world's fourth most populous country would have a substantial
impact. Some states were quiet members, which was also
acceptable. Cooperation involved sharing intelligence,
training and interdiction. Other maritime nations had joined
PSI, and a way could be found to accommodate the Indonesia's
legal requirements. Eventually the initiative might reach
the scope of a UN operation, but PSI would not be saddled
with bureaucratic process and protracted discussion. This
was a serious consideration with Iran seeking a seat on the
UN Disarmament Committee. Hariyadhi thanked the U.S.
delegation for the update but restated the Indonesian
position that PSI exceeded the UN Law of the Sea.

... GLOBAL PEACE OPERATIONS INITIATIVE (GPOI)


17. (C) On the Global Peace Operations Initiative (GPOI),
Hillen expressed satisfaction that the two sides had been
able to move quickly earlier in the year to establish
cooperation on peacekeeping training. This had helped to
facilitate U.S. support for Indonesia's UNIFIL deployment.
GPOI was a G-8 initiative involving a U.S. contribution of
$660 million over five years. It was especially aimed at
African and Asian partners. The United States wanted to find
ways to support the training center that Indonesia was
establishing, though U.S. funding could be used only for
military, but not for police, training.


18. (U) This message was cleared by Assistant Secretary
Hillen.
PASCOE