EDA: A New Pattern for US Arms Procurement?

During the period when the Ministry of Defence was led by Prabowo Subianto, there were no significant weapon system acquisitions from the United States, despite a policy prioritising purchases from permanent members of the UN Security Council. The import of five C-130J-30 aircraft, valued at US$500 million, was a legacy of the second phase of the Minimum Essential Force (MEF) programme, which was only executed after the leadership change at the Ministry of Defence in mid-October 201s9.

The promise made in St. Louis on 21 August 2023 to purchase F-15EX aircraft remains unfulfilled, even though the Minister of Defence for the 2019-2024 period has moved to the Presidential Palace. It raises the question of whether the absence of significant US acquisitions stems from paranoia regarding embargo trauma or other less rationalisable reasons. The trauma of an embargo has now become a paranoid justification, as essentially all defence equipment producers can impose an embargo based on their own national interests. It is a flawed view to assume that only the United States can impose an embargo on Indonesia. Weapon exporters to Indonesia, such as France, Italy, Turkey, Russia, and China, could similarly apply such policies if they deem Indonesia’s international alignment inconsistent with their national interests.

If Indonesia wishes to avoid future embargoes from other nations, the wisest advice would be to produce all warfare equipment domestically, using Indonesian raw materials and auxiliary components. Following the meeting between Defence Minister Sjafrie Sjamsoeddin and US Secretary of Defence Pete Hegseth on 13 April 2026 at the Pentagon, which resulted in the Major Defense Cooperation Partnership (MDCP) agreement, there appears to be an acceleration in the procurement process for US weapon systems. A core pillar of the MDCP is military modernisation and capacity building, which supports various defence trade activities.

Since the birth of the MDCP, the plan to purchase used USMC AAV7A1 amphibious assault vehicles has progressed rapidly, despite US offers for these combat vehicles facing uncertainty at the Ministry of Defence between 2016 and April 2026. The Marine Corps urgently requires these armoured vehicles to meet operational needs following organisational validation and the failure to import the Russian BT-3F due to CAATSA sanctions. Under a US$23 million programme, Indonesia is receiving 35 previously refurbished AAV7A1 units. This scheme utilises the Excess Defense Article (EDA) method combined with Foreign Military Sales (FMS), where equipment is sold to Indonesia at a rebate price, making procurement relatively inexpensive.

The AAV7A1 is no longer in production, as the USMC is replacing it with the ACV 8x8 produced by BAE Systems/Iveco. Prior to receiving the AAV7A1, the Marine Corps was already operating 15 KAAV7A1 units produced under licence by Samsung Techwin, South Korea, meaning no adaptation period was required for the US-origin amphibious vehicles.

Beyond the AAV7A1 acquisition, sources familiar with defence trade discussions between Indonesia and the US indicate that Indonesia has also explored procuring other weapon systems via the EDA scheme. However, several defence items targeted by Indonesia are not currently available as EDA that could be transferred from other nations. An interesting aspect of these explorations is that the desired war equipment is still being produced by manufacturers and is not discontinued. This raises the question: is a new pattern emerging in US arms purchases, favouring EDA over new equipment?

EDA-based acquisitions should not be avoided but should be considered on a case-by-case basis. In the context of the AAV7A1, EDA is the most sensible scheme to meet the Marine Corps’ operational needs, given that there are few manufacturers of amphibious vehicles globally. Furthermore, with a large population of these armoured vehicles and readily available spare parts, there are no significant sustainment challenges. However, the AAV7A1 context cannot be applied to weapon systems that are still in production, such as the F-16 or C-130J. The United States has other export schemes besides EDA, namely Foreign Military Sales (FMS), Direct Commercial Sales (DCS), and hybrid models. It is common knowledge that Indonesia dislikes the FMS scheme because it leaves no room for intermediaries.

Under the DCS scheme, US manufacturers are required by the US government to contract directly with the purchasing government, thereby eliminating the role of middlemen. Contract values in DCS are also difficult to inflate unreasonably, as there is a clear breakdown of contract figures based on the various subsystems adopted in the US-sourced weaponry. If the EDA scheme becomes Indonesia’s preferred pattern for defence trade with the US, would this disadvantage the nation when operational readiness is at stake, compared to purchasing new equipment through FMS, DCS, or hybrid schemes? For equipment such as aircraft, although there are airframe regeneration programmes, to the author’s knowledge, this can no longer be implemented…