The defense industry is a national industry that produces defense needs, both owned by the government and private, whose products, either independently or in groups, including maintenance services, can be utilized for the benefit of the national defense. The defense industry as an answer to the bitter experience of the military embargo in the decade of the 90s. A country that has a defense industry is considered to have a strategic advantage in the global order, because it is able to deter and respond to challenges or threats that are constantly changing. Defense capabilities require national capabilities that are independent and support the needs of the Alutsista effectively. Therefore, Indonesia needs a defense industry that grows sustainably, produces superior products and supports national economic growth.

Through the Law of the Republic of Indonesia number 16 of 2012 concerning the Defense Industry, it is stated that defense industry includes the main equipment industry, the main and or supporting component industry, the component industry and or supporting supplies and the raw material industry. In the defense industry Law, state-owned business entities is in the first layer, namely the production of main equipment, while private industry is in the next layer. However, this provision has been amended through the Job Creation Law, especially in article 74 which states that the main equipment industry is carried out by state-owned business entities and or Private owned business entities which is determined by the government as the lead integrator that produces the main weapon system equipment and or integrates all the main components, components and raw materials are the main tools.

The contribution of the private defense industry in building the independence of the national defense industry is felt to be still lacking. Private companies engaged in the defense industry, for example companies under the National Private Defense Industry Association. Should have the right portion to strengthen the independence of the defense industry. Ideally, if the roles of the private sector and state-owned enterprises synergize, it is hoped that it will form a favorable climate in building the defense industry. The development of the defense industry can create many jobs, encourage the growth of other industries because it has many multiple linkages from upstream to downstream, increase the ability to master high technology, reduce imports and even have the potential to bring in foreign exchange earnings through exporting various Indonesian defense products to other countries. Therefore, there is a need for further discussion of the role of private companies in synergy with state-owned companies to support the development of the defense industry. This research leads to a form of strategy that can be implemented to create independence from the defense industry.

This research is conducted through fieldworks based on qualitative approach. The data collection is done through observations, literature review for previous research, regulation of government especially ministry of defense, state-owned business entities and private owned business entities. The data collected are analyzed and interpreted to answer the research question. To determine which strategy to determine the strategy for the independence of the defense industry, private companies in synergy with state-owned companies to support the development of the defense industry.

Defense industry requires development cooperation and strong support from stakeholders. Defense industry builders must be assumed that, beyond the state there are also a community group, business entities or even individuals can contribute to creating prosperity through the industry is running.In its implementation, all owned enterprises and private sectors must mempedomani strategic kebijakan-kebijakan in construction of industrial, national defense among other things:

• The 2005-2025 Long-Term Development Plan which explains that the development of the defense sector is directed at efforts to develop a defense system, increase the participation of citizens in defending the country, protect Indonesia's maritime jurisdictions which include the Indonesian Exclusive Economic Zone and the basic the continent and the Indonesian air jurisdiction, the development of the national defense industry as well as increasing the professionalism of the TNI

• Law Number 16 of 2012 concerning the Defense Industry which mandates all stakeholders to work together in order to realize the independence of the National Defense Industry

• Government Regulation No. 76 of 2014 concerning the Trade-off Mechanism in the Procurement of Defense and Security Equipment from Abroad which includes the trade-off scheme, Local Content and Offset for technology transfer in the procurement of defense tool from other countries

• Regulation of the Minister of Defense Number 17 of 2014 concerning the implementation of the procurement of the main weapon system equipment within the Ministry of Defense and the TNI

Defense Industry players are obliged to build their capacity and capability through the preparation of strategic plans, the implementation of R&D and technology transfer processes. The development of science and technology in the field of defense globally has the following trends:

• Information Warfare. An action that disrupts and manipulates the opponent's information system

• Cybernatic Warfare. Information warfare involves operations to disrupt, fight, manipulate or destroy information centers in computers and computer networks

• Transnational Infrastructure Warfare. A war to attack vital industries and facilities such as communications, power generation, transportation, centers of government

• Asynchronous Warfare. Selective or delayed attacks against opponents who have a chance for a certain period of time

Technological development by the industries also should align with Revolution of Military Affairs (RMA) four components developed in response to RMA: weapon lethality, force projection, information processing and intelligence collection [1]. The journey taken by countries to implement RMA includes [2] (Figure 1):

• Paths: Emulations, adaptation and innovation

• Patterns: Speculation, experimentation and implementation

• Magnitude: Exploration, modernization and transformation

The explanation of paths, military emultion as activities involving the import of new equipment and methods of war, through imitation of other military organizations. While adaptation is defined through the adjustment of existing military means and methods in which some adaptation over time can lead to innovation. Military innovation is how to develop new military technology, tactics, strategies and organizational structures. Adapting the RMA-oriented concept, technology, other organizations and military organizations can change the tactics, concepts and technology of existing weapons. At the same time, military organizations might explore the RMA by developing new means and objectives of military operations. Farrell also stated that if RMA exploration leads to innovative doctrine or structural change, then it has crossed the threshold of innovation. In terms of patterns, Mahnken [3] explains that military institutions develop approaches to combat in three different but often overlapping patterns. Speculation is using new ways to solve existing operational problems, or knowing the potential of emerging technologies.

The characteristic of the independence of the defense industry is the existence of a strong network in the concept of partnership relations between industries. As stated by Luhut B. Panjaitan (then Minister of Industry and Trade), to increase competitiveness, as well as reduce the level of dependence from abroad, it is necessary to have a system of industrial grouping that is intensively interconnected and is an agglomeration (one rhythm) of companies that form partnerships, both as a supporting industry (vertical) and related industries (horizontally). 

Figure 1: The Step of Implementation RMA

Figure 2: The Concept of Inter-Industry Partnership

Figure 3: Masterplan Defense Industry Development

On the other hand, independence needs to be supported by quality human resources and interrelated mastery of technology. Human resources who are creative, innovative, confident and skilled in communicating and working together, are supporting factors in the success of production and production creation. In this case, it is also necessary to master the technology and logistics assurance as well as the ability to develop new products. Research and development is needed to enable new findings and optimally address various problems [4] (Figure 2).

The development of the defense industry must be able to deal with the capabilities of domestic products, the concept in the picture is that the higher the peak, the realization of independence. At the stage of being able to produce their own defense equipment, it means being able to carry out domestic procurement without involving parties or components from outside. The stages are carried out by means of product development which is carried out through an offset program, the maintenance stage is accompanied by building competence, the manufacturing stage is the production process which gradually increases the percentage of local content so as to create a good supply chain [5].

Indonesia have concept for construction of industrial defense in creating posture alutisista ideal in the 2025-2029 namely independence defense industry capable of collaborated internationally with the development of which sustainable [6] (Figure 3).

The role of the private sector is important to avoid problems such as in 1998, Indonesia faced a global economic crisis which had a profound impact on the Defense Industry. For example, PTDI was forced to undertake a management reshuffle and massive employee reductions to avoid bankruptcy [7-9]. Unfortunately, the Government was forced to stop financing large-cost strategic industrial projects, including subsidies for PTDI as part of the conditions for disbursing funds from the IMF in order to overcome the Indonesian economic crisis. With this incident, it is necessary to have the support of the private sector which is not completely dependent on capital from the state. The development of the defense industry is required with the following criteria:

• High tech

• Long-term, implemented in stages, across fiscal year

• Cross government

• There is a guarantee of continuity of program implementation between government eras

• Cross ministries/agencies

• Strategic value for the national interest

• Having aspects of economic feasibility as a support for national economic development and growth

• The existence of technology transfer to fill the technological gap towards independence. In implementing the National Program, the government involves State-Owned Enterprises as the main integration and Private-Owned Enterprises

The implementation of the role of the private sector in the development of defense industry is carried out in various ways, such as:

Regulation of Join Development, Joint Operation and Offset

Is a regulation compiled to regulate all aspects of the technology transfer process from foreign sources. The regulations were drawn up in the first period (2015-2019) and will be evaluated every 10 years.

Regulation of Research Synergy (Infrastructure, Human Resource Development, Financing)

Research synergies regulations are prepared to integrate all national resources in R&D, including the infrastructure needed for research, human resources and the arrangement of financing sources for R&D. The regulations were drawn up in the first period (2015-2019) and will be evaluated every 10 years.

Regulation of Awards for Innovations in Defense Industry Products

Regulations on awards for innovation are intended to encourage national researchers to create inventions and innovations, especially to develop Defense Industry products. The regulations were drawn up in the first period (2015-2019) and will be evaluated every 10 years.

Making derivative rules from Law number 16 of 2012 concerning defense industry into legal products such as Government Regulations, Presidential Regulations and other ministerial regulations, as guidelines for private industry in their contribution to defense industry

In an effort to see civil and military cooperation in the development of the national defense industry, 5 tools are needed, such as: (1) Ownership; (2) Market; (3) Industrial Base; (4) Government Role; (5) Foreign Sales Mechanism; (6) Dual-use; (7) Research and Development (R&D). Defense is a very technology-intensive sector, the role of the government to assist R&D activities and funding for the development of technology that is applicable to defense is very large. Naturally, because the true war is an attempt to exploit superiority over the enemy. One of them is technological superiority. Therefore, intensive R&D efforts are an important requirement to ensure the superiority of defense technology.

The defense industry is a strategic form and its distinctive character (enforcing sovereignty and security) so it is not surprising that the design of the Indonesian defense industry adheres to a state-centric approach, where the state fully manages the role of the state here, there are three kinds, namely as a customer, sponsor and regulator. First, as a customer, you cannot be separated from the monopsony characteristic of the defense sector, where the government is the most important or even the only customer. So here the government determines the demand for the defense industry.

The role of the defense industry in a country is important for the interests of the national economy and national security, therefore synergy and support from various stakeholders is needed in the development of Indonesia. The role of the private sector is important to support domestic production, with the support of the private sector, it can build domestic products so that there is no embargo and can meet defense needs. The strategic policy for the development of the defense industry is carried out with a strategic plan that is expected to be able to make Indhan's development independent.

1. Creswell, J.W. Penelitian Kualitatif and Desain Riset. Yogyakarta, Pustaka Pelajar, 2014.

2. Farrell, Theo. “Improving in War: Military Adaptation and the British in Helmand (2006–2009).” Journal of Strategic Studies, vol. 33, no. 4, 2010, pp. 567–594.

3. Mahnken, Thomas. “Uncovering Foreign Military Innovation.” Journal of Strategic Studies, vol. 22, no. 4, 1999.

4. Moleong, Lexy. Metodologi Penelitian Kualitatif. Bandung, PT Remaja Rosdakarya, 2002.

5. Rosen, Stephen P. “New Ways of War: Understanding Military Innovation.” International Security, vol. 13, no. 1, 1988.

6. Sudira, I. Nyoman. Fusi Sipil-Militer dalam Pengembangan Industri Pertahanan: Studi Perbandingan Amerika Serikat, Tiongkok dan India. Universitas Katolik Parahyangan.

7. Supriyatno, Makmur. Tentang Ilmu Pertahanan. Jakarta, Yayasan Pustaka Obor Indonesia, 2014.

8. Susdarwono, Endro Tri. “Pokok-Pokok Pikiran Mengenai Pembangunan Kemandirian Industri Pertahanan Indonesia dalam Undang-Undang Nomor 16 Tahun 2012 tentang Industri Pertahanan.” Jurnal Ius Constituendum, 2015.

9. Tuwanto, Pebri. “Politik Pembangunan Industri Pertahanan Nasional di Era Global.” Jurnal Gema Keadilan, 2015.