DEFENSE COOPERATION -- DASD CLAD'S MEETING WITH

C O N F I D E N T I A L SECTION 01 OF 03 JAKARTA 003358 SIPDIS SIPDIS DEPT FOR EAP, EAP/MTS, EAP/MLS, EAP/RSP NSC FOR E.PHU SECDEF FOR USDP/ISA/AP CLAD/TOOLAN/IPSEN E.O. 12958: DECL: 12/10/2017 TAGS: PREL MARR PGOV ID IN CH XE SUBJECT: DEFENSE COOPERATION -- DASD CLAD'S MEETING WITH MINDEF SUDARSONO REF: JAKARTA 3155 Classified By: DCM John A. Heffern, reasons 1.4 (b,d). ¶1. (C) SUMMARY: DASD Clad discussed U.S.-Indonesia mil-mil cooperation and East Asian regional security with MinDef Sudarsono on December 5. Sudarsono said Indonesia wanted an effective but low-visibility security relationship with the United States. He said the GOI was focusing its air capacity-building on lift and interception, and was considering purchasing additional new F-16 fighters. Clad said Washington would support such a sale and wanted to make the mil-mil relationship stable and substantive. The two also discussed China and Taiwan as regional stability issues, and bilateral cooperation with India. END SUMMARY. MEETING WITH MINDEF ¶2. (C) In his December 5 meeting with Indonesian Defense Minister Juwono Sudarsono, Deputy Assistant Secretary of Defense for South and Southeast Asia James Clad conveyed greetings from SecDef Gates, who hoped to visit Indonesia early in 2008. The USG looked forward to a full, serious agenda for the next meeting of the U.S.-Indonesia Strategic Dialogue (IUSSD) in Washington in April. ¶3. (C) Clad said the United States wanted to make the mil-to-mil relationship more routine, as should be the case now that sanctions had been lifted. Both sides should work to make the relationship normal, stable and based on substantive cooperation. It was important to create the momentum that would make it difficult for differences on other issues to "pull the relationship back." Sudarsono said Indonesia sought to maintain a balance in its security relationships. In accordance with Indonesia's non-aligned orientation, Indonesia was working with all of its neighbors, including ASEAN, Australia, China, Russia, Japan and Korea. With the United States, Indonesia wanted an effective relationship but one with low visibility. Clad said the United States accepted and respected Indonesia's non-aligned stance. AIR CAPABILITY NEEDS ¶4. (C) The Indonesian Navy and Air Force were especially in need of new technology, including surface ships, transport and aircraft, according to Sudarsono. Indonesia did not intend to develop a strike force at this time. Indonesia had to look also to other countries because of the legacy of the U.S. embargo in the 1990s. Current conditions made such an embargo unlikely to happen again, but residual concerns remained. Clad said Washington understood that sentiment, but also believed that the corner had been turned and that the relationship was moving forward in a positive direction. ¶5. (C) Indonesian procurement was focused on building a dual capacity, i.e., equipment which could also be used for disaster relief and humanitarian assistance as well, Sudarsono said, given the Indonesian military's extensive involvement in such operations. In addition to military equipment, relief equipment such as field hospitals, tents and so forth were welcome. Clad underscored that the United States wanted to help Indonesia build its air capability and said the U.S. Pacific Command (PACOM) fully shared the emphasis on dual capacity. F-16 INTEREST CONFIRMED ¶6. (C) Clad noted that Indonesia had reportedly submitted a request for price and availability data on U.S. F-16 fighters (reftel). He said the United States was in the process of accelerating the refurbishment of C-130s. Sudarsono confirmed Indonesia's interest in acquiring additional F-16s and Clad's assessment that Indonesia's current air needs were primarily lift and interception, noting that 65 percent of JAKARTA 00003358 002 OF 003 the procurement budget went to airlift and that Indonesia was planning to purchase additional refurbished F-16s through Foreign Military Sales (FMS). (Note: In a luncheon discussion at the DCM's with defense officials and observers, MinDef Economic Adviser Adnan Ganto told Clad that Russia had yet to set a price for the Sukhoi fighters that Indonesia was considering purchasing under the $1 billion credit package that Moscow had offered to Indonesia. Retired Air Vice Marshal Koesnadi Kardi, formerly Director of Training and Education at the Department of Defense, said only two of Indonesia's four Sukhois were currently airworthy.) 1206 FUNDING ¶7. (C) Clad and DATT summarized current difficulties with the Indonesian Navy regarding procurement of land for construction of radar stations in Sumatra and Sulawesi under Section 1206 funding for FY06 and FY07. They underscored that Indonesia was in danger of losing the U.S. assistance if sites were not found soon. Sudarsono explained that the Indonesian Navy needed money to certify the land and that specific funding had not been budgeted for these projects. He acknowledged the need for action and said he would discuss the matter with the Minister of Finance. BILATERAL COOPERATION ACTIVITIES ¶8. (C) DATT noted other upcoming expected U.S. visits, which included PACOM J5 in February for the Defense Dialogue in February (in Jakarta) and PACOM Commander Keating in April. Reviewing current bilateral military-to-military cooperation, DATT said engagement had grown exponentially and now embraced 140 separate activities annually at all levels and 44 participants in the International Military Education and Training (IMET) program in 2007. CHINA VISIT ¶9. (C) Asked about his recent visit to Beijing, Sudarsono noted that the visit had occurred on the heels of SecDef Gates' visit to Beijing. China wanted to assist Indonesia in developing defense technology. During the visit, Indonesia had signed a memorandum of understanding on bilateral technical cooperation. ¶10. (C) Sudarsono said China realized that it needed the presence of the United States in the region as a check against Japan. However, Japan's voice in the region had become weaker in recent years. He agreed with Clad's observation that it was better that Japan remain involved in Southeast Asia. Noting that a previous DIA briefing on China to an Indonesian audience had been very well received, Clad offered to provide a further briefing on the next annual report. TAIWAN -- ISSUE OF CONCERN ¶11. (C) Sudarsono said Indonesia was "very concerned" about the issue of Taiwan, which had been mentioned at least twenty times in the most recent Chinese Communist Party congress. Tensions across the Strait of Taiwan were "a dangerous issue." China's claims to the Spratley Islands in the South China Sea were also a concern, although Indonesian interests were not directly threatened. ¶12. (C) Agreeing with Sudarsono's assessment of the Taiwan issue, Clad commented that a key U.S. concern was the possibility of a miscalculation by either party. Both sides were prone to missteps, which could trigger a confrontation. Sudarsono said cross-strait tensions depended very much on events in Taiwan and that it was very difficult to control the political situation in Taiwan. There was much resentment against China in Taiwan over China's meddling in Taiwan's affairs. JAKARTA 00003358 003 OF 003 ¶13. (C) Sudarsono noted that Indonesia had a trade office in Taiwan but no political representation. China had reacted strongly to transit visits by Taiwan President Chen Shui Bien in Bali and more recently in Batam. Although that incident had occurred five months earlier, China had made an issue of it during Sudarsono's recent visit to Beijing, warning against any further "unexpected" Taiwan visitors. Clad said China had similarly objected to having been excluded, as China saw it, from recent meetings among Australia, India, Japan and the United States on regional security issues. INDIA -- MIL-MIL IN PROCESS ¶14. (C) Sudarsono said Indonesian cooperation with India was growing, but that the relationship still needed some "fleshing out." Indonesia was able to use some Indian military equipment and India had a good maintenance system for Russian-made equipment, Sudarsono related. ON ENGAGEMENT ¶15. (C) In a separate luncheon discussion with Indonesian defense officials and observers (which did not involve Sudarsono),Presidential Adviser Gen. (ret) Agus Wijojo urged Washington to consider whether sanctions or engagement was the more effective strategy for helping Indonesia to move forward. Sanctions often tended to penalize the reformers, sent a negative message and restricted cooperation. Engagement sent a positive message and empowered cooperation. Wijojo cited Clausewitz' dictum that "if you surround the enemy, he will fight to the death, but if you give him some room to maneuver, he has an incentive to cooperate." ¶16. (C) Wijojo added that, despite continued sensitivity about the United States as a "reliable" supplier, Indonesia's defense procurement had to be done systematically and that ad hoc purchases of different systems from various countries would not yield effective capabilities. The United States needed to consider how it might position itself to become once again the mainstay of Indonesian defense capabilities. ¶17. (U) DASD Clad did not have the opportunity to clear this message. HUME