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(Journal Article) The Impact of CAATSA Sanctions From The United States of America On Indonesia
(Journal Article) The Impact of CAATSA Sanctions From The United States of America On Indonesia
ABSTRACT
The procurement of 11 units of Sukhoi Su-35 aircraft by Indonesia from Russia in
2017 has not been able to see the daylight. Until the making of this article, there are
still no new reports on the date of arrival of these aircraft. Many sources claim that
the United States’ sanctions are the main culprit behind this issue. That sanction is
named Countering America’s Adversaries Through Sanctions Act (CAATSA). This
article tries to explain the reasoning behind the implementation of the sanctions by
the United States through the scope of Coercive Diplomacy and Non-Tariff Barriers
and also foresees what action Indonesia will take to respond to the pressure endured
from the United States.
Keywords: CAATSA; Sukhoi Su-35; F-16 Viper; Indonesia, United States; Russia;
Coercive Diplomacy; Non-tariff Barriers.
Background
To fulfill the Minimum Essential Force (MEF) for defense equipment of the
National Armed Force/Tentara Nasional Indonesia (TNI), Indonesia carries out every
effort to procure and develop the domestic defense industry to achieve the MEF
minimum main target of the defense equipment. Based on information from the
Directorate General of Defense Forces of the Ministry of Defense (Ditjen Kuathan
Kemhan) in 2018, the percentage of TNI’s MEF fulfillment in the Indonesian Army
(TNI AD) reached 68.72 percent, for the Indonesian Navy (TNI AL) it reached 74.62
percent, and for The Indonesian Air Force (TNI AU) reached 44.40 percent. Based on
these data, it can be concluded that the Indonesian Air Force is experiencing
problems in fulfilling its defense equipment needs.1
The need to procure new aircraft was firstly proposed by the former
Indonesian Air Force Chief of Staff (KSAU), Air Chief Marshal Yuyu Sutisna in an
interview with Detik News on January 17, 2018. The proposal of Air Chief Marshal
Yuyu Sutisna was submitted to the Ministry of Defense to replace the F-5 Tiger
aircraft that have entered its retirement.2 On August 10, 2017, Indonesia entered a
1
Fitri, Aulia dan Debora Sanur. Pemberdayaan Industri Pertahanan Nasional dalam Pemenuhan Minimum
Essential Forces. Info Singkat. Vol.XI, No.22/II/Puslit/November/2019. (2019)
2
Prasetia, Andhika. 2018.”Resmi, Indonesia Teken Pengadaan 11 Sukhoi Su-35 Pengganti F-5”. Detik.
https://news.detik.com/berita/3877911/resmi-indonesia-teken-pengadaan-11-sukhoi-su-35-pengganti-f-5.
trade agreement with Russia for the purchase of 11 units of Sukhoi Su-35, in which
Indonesia will sell its domestic commodities to Russia. As for the trade agreement, of
the total US $ 1.14 billion purchase of the Sukhoi Su-35, US $ 570 million, or half of
which will return to Indonesia in the form of domestic commodity exports.3
However, until 2019, there has been no further news regarding the
development of the aircraft purchase or when the aircraft will arrive in Indonesia.
After the absence of news during this period, in November 2019, former KSAU Air
Chief Marshal Yuyu Sutisna stated that Indonesia plans to purchase the Lockheed
Martin F-16 Block 70/72 Viper fighter from the United States (US). 4 The news
page Bloomberg reported on March 12, 2020, that Indonesia canceled the trade
agreement for the 11 Sukhoi Su-35 fighter aircraft. 5 The change in Indonesia's policy,
which was originally set to purchase Sukhoi Su-35 aircraft and later became the
agenda for the purchase of the F-16 Viper aircraft, was allegedly based on threats
from the US to Indonesia through CAATSA sanctions.
Recalling the events from 1999 to 2005, the United States imposed an
embargo on defense equipment against Indonesia based on the misuse of defense
equipment for crimes against humanity in East Timor. Due to this, one of the impacts
felt by Indonesia was an obstructed mobility in handling various domestic conflicts
due to many aircraft that cannot be operated.8
Accessed 13 May 2020.
3
Deny, Septian. 2017. “RI Barter Sukhoi Rusia dengan Kopi, Begini Mekanismenya”. Liputan 6.
https://m.liputan6.com/bisnis/read/3067331/ri-barter-sukhoi-rusia-dengan-kopi-begini-mekanismenya. Accessed
13 May 2020.
4
Sani, Abdullah. 2o19. “TNI AU Makin Kuat, Indonesia Beli 2 Skadron F-16 Block 72 Viper”. Merdeka.
https://www.merdeka.com/peristiwa/tni-au-makin-kuat-indonesia-beli-2-skadron-f-16-block-72-viper.html.
Accessed 15 May 2020.
5
Salna, Karlis & Arys Aditya. 2020. “Trump Threat Spurred Indonesia to Drop Russia, China Arms Deals”.
Bloomberg. https://www.bloomberg.com/news/articles/2020-03-12/trump-threat-spurred-indonesia-to-drop-
russia-china-arms-deals. Accessed 15 May 2020.
6
Prasiti, Dian Naren Budi. “Countering America’s Adversaries Through Sanctions Act (CAATSA)
Inconsistencies: The Case of India S-400 Weapon Procurement” Global Strategis 13, No 2 (2019): 124
7
Wroughton, Lesley. 2018. “US Sanctions China for Buying Russian Fighter Jets Missiles” Reuters.
https://www.reuters.com/article/us-usa-russia-sanctions/u-s-sanctions-china-for-buying-russian-fighter-jets-
missiles-idUSKCN1M02TP. Accessed 15 May 2020.
8
Kusumadewi, Anggi, Resti Armenia. 2016. “Kisah Embargo AS dan Sukhoi Rusia di Balik Jet Tempur RI” CNN
Indonesia. https://www.cnnindonesia.com/nasional/20160301150059-20-114600/kisah-embargo-as-dan-sukhoi-
The US defense equipment embargo on Indonesia in 1999 had a significant
impact on Indonesia. Some of the impacts felt by Indonesia were the laying
off/discharge of planes owned by the Indonesian Air Force, of which the majority
were US-made defense equipment. Besides, Indonesia also received a ban from
participating in the American military training program, International Military
Education and Training (IMET).9 Apart from the military relations between the two
countries through the trade of defense equipment and close cooperation in the
education and coaching sectors, the United States also has a significant influence on
the Indonesian economy in which the United States is one of the main export
destinations for Indonesia, attaining the third position of Indonesia's top trading
partner.10
Facing the embargo sanction, Indonesia chose to buy Russian Sukhoi Su-27
and Su-30 air defense equipment.11 Despite having had a significant impact on
various fields, especially those in which related to the cooperation projects with the
United States, Indonesia was able to act quickly to overcome the fundamental
problem, namely the absence of aircraft defense systems by purchasing these
Russian-made aircraft. The embargo incident can be used as a lesson for Indonesia,
especially in responding to the threat of CAATSA sanctions by the United States.
In the context of CAATSA, at the Senate meeting in Washington in April
2019, the US Secretary of State Mike Pompeo confirmed that America through
CAATSA will impose sanctions on countries that buy Russian weapons
systems.12 Specifically, on the main provisions regarding Russia in
CAATSA, Title II Section 231 stated:
This provision of the law CAATSA was the basis for the assumption that the
process of purchasing Sukhoi Su-35 fighter aircraft was delayed, and later changing
the Government's policy to purchase the United States F-16 Viper instead.
rusia-di-balik-jet-tempur-ri. Accessed 12 May 2020.
9
Murphy, Ann Marie. 2010. “US Rapprochement with Indonesia: From Problem State to Partner” Contemporary
Southeast Asia Vol. 32 3 (2010): 366
10
“Indonesia Top Trading Partners”. World’s Top Exports. http://www.worldstopexports.com/indonesias-top-
15-import-partners/. Accessed 22 June 2020
11
Hidayat, Faieq. 2017. “Cerita Megawati Saat Beli Pesawat Sukhoi Milik Rusia”. Detik News.
https://news.detik.com/berita/d-3569146/cerita-megawati-saat-beli-pesawat-sukhoi-milik-rusia. Accessed 12 May
2020.
12
Anon, 2019. “Rencana Indonesia Beli Sukhoi Su-35 Terancam Gagal gara-gara CAATSA-Apa Itu?”.
Kumparan. https://kumparan.com/kumparanbisnis/rencana-indonesia-beli-sukhoi-su-35-terancam-gagal-gara-
gara-caatsa-apa-itu-1tkVqXjwkcw. Accessed 15 May 2020.
13
III, John B. Reynolds. et al. The Countering America’s Adversaries Through Sanctions Act Becomes Law. New
York: Davis Polk & Wardwell. (2017)
Literature Review
The discussion on the use of the CAATSA sanction threat by the United
States has been previously analyzed by Dian Naren Budi Prastiti and published by
Global Strategies in 2019 in a journal article titled “Countering America's
Adversaries Through Sanctions Act (CAATSA) Inconsistencies: The Case of India S-
400 Weapon Procurement”. This journal article discusses the use of CAATSA
sanctions as a form of coercive diplomacy between the United States and India,
which purchases S-400 missiles with Russia. This journal article also looks at the
factors that influence the success or failure of the United States' coercive diplomacy.
The goal of the United States is threatening sanctions against India was an attempt of
securitization to countries that are considered as a threat to the US' national interests.
The United States' attempt was failed, with India continuing to buy the Russian-made
missiles. This failure was due to the ineffectiveness of several aspects of the coercive
diplomacy carried out by the United States, namely the absence of legitimacy from
India to threats from the United States, the absence of real action from the United
States to prove its threat to India, the absence of a due date/deadline given to India to
comply with the US’ threat, and India's vital national interests were at stake so that
there is an absolute motivation from India to ignore the threat of the United States.
Methodology
As for secondary data sources of this research, the author took data from
journal articles, open-source information from the United States government, the
results of interviews with the Russian Ambassador to Indonesia, Lyudmila Vorobieva
to various news platforms, and various articles from electronic media news sources.
Conceptual Framework
This study uses the theory of Coercive Diplomacy and Non-Tariff Barriers.
These two theories aim to explain and illustrate the interests of the United States in
implementing the threat of CAATSA sanctions against Indonesia for the procurement
of the Sukhoi Su-35, as well as the further stance that Indonesia could take to face the
threat of US sanctions. Coercive diplomacy has a definition of giving threats made by
the subject country to the targeted country to postpone or cancel its actions. Coercive
diplomacy has several factors that influence its success, these factors are the
existence of a clear demand, the existence of a threat that can be proven by the
subject country to the targeted country, the existence of a clear due date/deadline for
the targeted country to comply with the request,14 and present awards if the targeted
country heeds the demand by the subject country which threaten them. 15 In the
application of coercive diplomacy, the subject who gives the threat needs to pay
attention to several aspects, namely the aspect of reciprocity—in which even though
the targeted country is under pressure from the subject's country in the form of a
threat, it must create a feeling of mutual benefit for both parties at the demand of the
threatening state. Moreover, it needs to be supported by the credibility of the threat
with the intention that the targeted country can see the impact of the threat received if
it does not follow the demand, but there is also a reward if the demand is being
met/accomplished.16
Discussion
The implementation of the state defense system is stated in Law No. 3 of 2002
on National Defense. National defense is built systematically to overcome all threats.
National defense is composed of several components consisting of the Indonesian
National Army as the main component supported by reserve and supporting
components consisting of citizens, natural and artificial resources, as well as national
facilities and infrastructure that are prepared to strengthen the main components. The
Minister of Defense determines bilateral, regional, and international cooperation
policies in his/her field. The Minister of Defense has the authority to determine
policies for the deployment of the National Armed Force and other components, as
well as to determine policies on budgeting, procurement, and development of national
resources and defense technology required by the National Armed Force and other
defense components. The Minister of Defense works closely with other government
departments and agencies in planning strategic policies.19
The Minister of Defense has the authority to write the Indonesian Defense
White Paper as a form of transparency and understanding of the national defense, as
well as a form of Confidence Building Measures for the international community.
The paper stated that Indonesia's defense system in responding to the dynamics of
threats to the state is carried out by promoting diplomacy which is strengthened by
modern military facilities.20 In the context of international relations, Indonesia is
guided by Politik Bebas Aktif (Free and Active act of politics) with the development
of a defense force aimed not as an arms race, but to fulfill the vision and mission
of Nawacita (Indonesia’s nine fundamental agendas and priorities) and the World
Maritime Axis. Countries are undertaking modernization of defense technology as an
effort to increase defense standards that have been triggered by the development of
the defense technology industry and to anticipate uncertainty in strategic
situations.21 Indonesian defense technology was developed to produce Defense and
Security Tools (Alpalhankam) that meet the standard operational requirements.22
18
Valles, Guillermo. NON-TARIFF MEASURES TO TRADE: Economic and Policy Issues for Developing
Countries. Geneva: UNCTAD. (2013). 5.
19
2002. “UNDANG UNDANG REPUBLIK INDONESIA NOMOR 3 TAHUN 2002 TENTAN PERTAHANAN
NEGARA”. Tana Ngada Database Peraturan. https://ngada.org/uu3-2002.htm. Accessed 30 October 2020.
20
2015. Buku Putih Pertahanan Indonesia 2015. Kementerian Pertahanan Republik Indonesia. 2
21
Ibid. 8
22
Ibid. 63-64
To support the policy of the World Maritime Axis, it is necessary to increase
maritime security, namely maritime force capacity that maintains the maritime
sovereignty of the outer islands, enhancement of land force capacity by securing the
mainland areas of the state border, as well as air force capacity by supporting the
security of land borders and outer sea areas with the ability to observe and air
sensing.23 To carry out these efforts, a defense technology which able to facilitate
various security activities is crucially needed.
Article 47, Law No. 16 of 2012 regarding the Defense Industry states that
achieving the needs of defense equipment is carried out by undergoing mutually
beneficial cooperation by prioritizing national interests.24
Based on the 2018 data from the Ministry of Defense regarding the progress
of the achievements of MEF I and II, especially in the Aircraft section in the
Indonesian Air Force dimension, it was stated that the target at MEF II could procure
301 aircraft units, whereas in the conditions before MEF, the Government had 211
aircraft units and at MEF I (2010-2014 period), the government has procured 50
aircraft, fulfilling 75.87 percent of the MEF achievement target. Then in MEF II,
23
Ibid. 54-55
24
Ibid. 69
25
Ibid. 67
26
2012. “Kebijakan Penyelarasan Minimum Essential Force Komponen Utama: Peraturan Menteri Pertahanan
Republik Indonesia No. 19 Tahun 2012”. Kementerian Pertahanan.
https://www.kemhan.go.id/ppid/wp-content/uploads/sites/2/2016/10/Permenhan-Nomor-19-Tahun-2012-
Lampiran-1.pdf Accessed 15 December 2020.
27
Fitri, Aulia dan Debora Sanur. Pemberdayaan Industri Pertahanan Nasional dalam Pemenuhan Minimum
Essential Forces. Info Singkat. Vol.XI, No.22/II/Puslit/November/2019. (2019)
namely the 2015-2019 period, the Government increased the aircraft procurement
target to 301 units and has procured 6 aircraft units. Thus, by the end of MEF II,
Indonesia had 267 aircraft, fulfilling 77.62 of its target Minimum Essential
Force.28 Based on these data, the government needs 34 aircraft to meet 100 percent of
the MEF target in the procurement of fighter aircraft.
Indonesia is cooperating with Russia for the purchase of the Sukhoi Su-35
fighter aircraft which was agreed upon during a trade mission to Russia by the
Minister of Trade (Mendag), Enggartiasto Lukita on August 10, 2017, by signing a
memorandum of understanding (Memorandum of Understanding / MOU) between
the two countries. Trade Minister Enggar stated in a press conference at the Ministry
of Defense office on Tuesday, August 22, 2017, that Indonesia appointed PT. The
Indonesian Trading Company (PT. PPI) and Russia appointed Rostec as the
coordinator. Trade Minister Enggar stated that the 11 aircraft that have been
purchased by Indonesia would be shipped in two years. 31 In 2018, an agreement
between the former Minister of Defense (Menhan) Ryamizard Ryacudu and the
Russian Government regarding the Sukhoi purchase agreement was signed. 32 Besides,
in an interview with Russian news source TASS, the Indonesian Ambassador to
Russia, Mohamad Wahid, stated that the delivery of the Sukhoi Su-35 fighter aircraft
could be carried out in 2019.33
28
Ibid.
29
Putra, Erik Purnama. 2015. “Anggaran TNI AD Rp 9,3 Triliun, AL Rp 17,4 Triliun, dan AU Rp 93,9 Triliun”
Republika. https://republika.co.id/berita/nr2nvf/anggaran-tni-ad-rp-93-triliun-al-rp-174-triliun-dan-au-rp-939-
triliun Accessed 16 December 2020.
30
Andwika, Rizky. 2017. “Indonesia akhirnya beli 11 jet tempur Sukhoi-35 dari Rusia”. Merdeka.
https://www.merdeka.com/peristiwa/indonesia-akhirnya-beli-11-jet-tempur-sukhoi-35-dari-rusia.html Accessed
15 December 2020.
31
Saubani, Andri dan Santi Sopia. 2017. “Imbal Beli Skhoi, Rusia Wajib Beli Komoditas Indonesia”. Republika.
https://m.republika.co.id/berita/nasional/umum/17/08/22/ov2x1d-imbal-beli-sukhoi-rusia-wajib-beli-komoditas-
indonesia Accessed 14 December 2020
32
Bureau, Our. 2020. “Indonesia, Russia Still Negotiating Su-35 Deal”. Defense World.
https://www.defenseworld.net/news/26522/Indonesia__Russia_Still_Negotiating_Su_35_Deal#.X Accessed 15
December 2020.
33
Anon. 2019. “Deliveres of Russian Su-35 fighter jets to Indonesia may begin in 2019”. TASS.
https://tass.com/defense/1050375 Accessed 14 December 2020
However, until 2020, there is still no further update or news regarding the
delivery of the aircraft. The delay in the purchase process is presumed to have been
caused by several factors, such as technical constraints, the alignment of the contract
mechanism, to the threat of CAATSA sanctions by the United States. Reporting from
the news page Defense World, the technical problem faced by the two countries is the
problem of calculating the traded price of commodities. Indonesia and Russia have
yet to find an agreement on the fixing of average commodity prices, in which Russia
wants the average price to be set as low as possible. 34 When the situation regarding
the stagnation was still questionable, Russia through its Ambassador to Indonesia,
Lyudmila Vorobieva stated in her interview with CNN Indonesia that the obstacle
that was the cause of the stagnation of the cooperation in the procurement of the
Sukhoi Su-35 was the existence of several problems in aspects in contracts which are
still in the process of negotiation, as well as threats and pressure from the United
States for Indonesia to establish defense relations with Russia in the purchase of
combat aircraft defense equipment.35 Russian Ambassador Lyudmila's statement
regarding US pressure on Indonesia indicates the possibility of CAATSA to impose
sanctions on Indonesia if it persists in buying Sukhoi Su-35 from Russia.
The CAATSA policy was established on the 2nd of August 2017 by the
United States Government. The policy enhances and strengthens the sanctions which
were previously established through Executive Order (E.O) addressed to Iran, Russia,
and North Korea. The CAATSA policy has several key provisions which are divided
into three titles that discuss US policy towards Russia, Iran, and North Korea. The
United States has adopted several policies to impose sanctions on Russia for Russia's
position on several occasions related to Ukraine and Syria. The discussion of
sanctions aimed at Russia is discussed in Title II entitled "Sanctions with Respect to
Russian Federation and Combating Terrorism and Illicit Financing" and divided
into several parts.36
Part 2 titled "Sanctions with Respect to the Russian Federation" discusses the
forms and mechanisms of sanctions imposed by the United States on Russia. Section
231 on Imposition of Sanctions with Respect to Persons Engaging in Transactions
with The Intelligence or Defense Sectors of the Government of the Russian
Federation specifically describes the criteria for parties who can be designated as
sanctions recipients and their mechanisms and also discusses the criteria for Waiver
grant Waiver.
34
Bureau, Our. 2020. “Indonesia, Russia Still Negotiating Su-35 Deal”. Defense World.
https://www.defenseworld.net/news/26522/Indonesia__Russia_Still_Negotiating_Su_35_Deal#.X Accessed 15
December 2020.
35
CNN, Tim. 2020. “VIDEO: Dubes Rusia Blak-blakan soal Rencana RI Beli Su-35”.
https://www.cnnindonesia.com/internasional/20200205205533-110-472066/video-dubes-rusia-blak-blakan-soal-
rencana-ri-beli-su-35 Accessed 14 December 2020
36
2017. One Hundreth Fifteenth Congress of the United States of America. United States Government
Information. 13-15.
“On and after the date that is 180 days after August 2, 2017, the President
shall impose five or more of the sanctions described in section 235 with respect to a
person the President determines knowingly, on or after such date of enactment,
engages in a significant transaction with a person that is part of, or operates for or
on behalf of, the defense or intelligence sectors of the Government of the Russian
Federation, including the Main Intelligence Agency of the General Staff of the Armed
Forces of the Russian Federation or the Federal Security Service of the Russian
Federation. "37
The CAATSA policy owned by the United States has resulted in many of
Russia's trading partner countries to conduct a secondary discussion on improving
trade performance and cooperation, especially in the field of defense equipment. This
policy had a real impact on Russia's partner in Southeast Asia, namely Indonesia. The
purchase of the Russian Sukhoi SU-35 aircraft by Indonesia which was initiated in
2017 has not been implemented until now, resulting in a stagnation of Indonesia-
Russia cooperation on the purchase of Sukhoi Su-35. Russian Ambassador to
Indonesia, Lyudmila Vorobieva explained the situation regarding the development of
the aircraft procurement in her interview with CNN Indonesia. According to the
interview, it can be presumed that in addition to the technical problems with the
purchase contract which are still in the negotiation process, Russia does not deny that
there is a threat from the United States affecting Indonesia in the Sukhoi buying
process. However, Russia chose to stay optimistic that Indonesia's procurement of the
Sukhoi Su-35 would continue to be processed. Russia was also trying to provide
reassurance for Indonesia against the possibilities of the US sanctions if Indonesia
decided to continue the procurement/trade agreement. Also, the Russian Ambassador
to Indonesia, Lyudmila specifically stated that China, India, and Turkey continued to
purchase Russian defense equipment despite the threat of CAATSA sanctions by the
United States. Russia also encouraged the need for an independent stance for the state
to carry out its policies, including in foreign and defense policies.
37
Ibid. 31
38
Ibid. 34
or convince Indonesia to ignore the threat of the US sanctions. Sanctions avoidance
measures could be one of the steps Russia can offer to the Sukhoi Su-35 purchase
contract if the two countries persist in making this purchase/agreement a success.
Moreover, it can be seen that the United States is trying to protect its domestic
aerospace industry from the competition through CAATSA sanctions regulations.
Indonesia, which switched to purchasing the F-16 Block 72 Viper aircraft instead of
Sukhoi Su-35, was one of the key points of analysis, whereas the F-16 is an aircraft
made and developed by Lockheed Martin and General Dynamics, an aerospace
company from the United States. This certainly provides another advantage for the
United States and it can increase US revenue from the sale of its aerospace products
and increase the dominance of its influence and military equipment in Southeast Asia,
especially Indonesia. Therefore, the Southeast Asian countries will be in a less
powerful position to reject certain demands from the United States for several
regional issues that occur due to the domination of combat equipment and important
facilities by the United States. The consternation of the threat of embargo sanctions
imposed by the United States is one reason that the US military partners were unable
to conduct much effort than heed the United States' request. Looking at the United
States' stance from economic rationales, it can be seen that the United States seeks to
protect the domestic aerospace industry from the competition through CAATSA
sanctions regulations. Indonesia, which suddenly declared the purchase of the F-16
Viper aircraft in 2019, illustrates Indonesia's shift from the previous Sukhoi Su-35 to
the F-16 Viper. This illustrates one of the bases of these allegations, where the F-16 is
an aircraft made and developed by Lockheed Martin and General Dynamics, an
aerospace company from the United States.
Four factors affect the success of the CAATSA threat as a form of coercive
diplomacy towards the purchase of Indonesia's Sukhoi SU-35 aircraft, namely (1)
there is a clear demand, (2) there is a threat that can be proven, (3) there is a clear
deadline, and (4) there is an award given to the destination country if they heed the
demand of the threatening country. Based on these factors, it appears that the United
States has a clear request for Indonesia, namely canceling the purchase of the Sukhoi
Su-35. Then, the United States has a demonstrable threat, namely the sanctions set
out in the CAATSA policy, especially the ban on commodity exports by PT. PPI is
the third party appointed by the government to purchase the Sukhoi Su-35. Referring
to the example of the China case, the Chinese Equipment Development Department
(China's Equipment Development Department of the Central Military Commission)/
EDD was sanctioned number 2 CAATSA Section 235 by the United States for the
purchase of 10 units of Sukhoi Su-35 from Russia with a ban to assign licenses,
exports and participate in the US financial system. This aspect can give a
psychological impact, namely coercive ability in which Indonesia has the potential to
be caught in the same case as China.
In the context of deadline clarity, the United States itself did not give a clear
deadline for Indonesia to cancel the purchase of the Sukhoi Su-35. However,
Indonesia already has its deadlines to fulfill the MEF, especially in the Strategic Plan
III 2020-2024. This urgency is compounded by the situation of neighboring countries
that continue to buy the latest defense equipment. Then, the United States gave an
award to Indonesia in the form of offering an alternative aircraft from the Sukhoi Su-
35, namely the F-16 Block 72 Viper. In addition, it is believed that the supply of
spare parts for defense equipment from the United States, strategic cooperation such
as various training programs with the Indonesian Armed Forces and the United States
will remain guaranteed, and the trade partnership and cooperation relations with the
United States will not be disrupted.
39
Deny, Septian. 2017. “RI Barter Sukhoi Rusia dengan Kopi, Begini Mekanismenya”. Liputan 6.
https://m.liputan6.com/bisnis/read/3067331/ri-barter-sukhoi-rusia-dengan-kopi-begini-mekanismenya. Accessed
13 May 2020.
40
“Produk Ekspor”. PT. Perusahaan Perdagangan Indonesia.
http://www.ptppi.co.id/id/produk-komoditi/perdagangan-luar-negeri/produk-ekspor.html Accessed 10 December
2020.
Indonesia has carried out various efforts as a response in facing the threat of
CAATSA sanctions by the United States. Some of the actions that can be conducted
by Indonesia against the threat of CAATSA sanctions from the United States are
purchasing Sukhoi and F-16 aircraft simultaneously, seeking alternative fighter
aircraft apart from the United States and Russia, decide to purchase the F-16 Block
72 Viper and cancel the purchase of Sukhoi, considering the Waiver as a way to
avoid CAATSA Sanctions, and delaying the purchase of the Sukhoi Su-35 to get a
better closure of how the United States Government, Joe Biden carries out its foreign
policy, including CAATSA policies.
Certainly, Indonesia does not want to lose its relationship with both the
United States and Russia. Hence, to break the deadlock in the agreement of fighter
aircraft procurement, in order to meet the needs of the MEF Strategic Plan III for
2020-2024, Indonesia is trying to find alternatives of fighter aircraft from
manufacturers other than the United States and Russia. Indonesian Defense Minister
Prabowo Subianto has noted that his interest in Austria's Eurofighter Typhoon and
French-made Dassault Rafale,41 which both has a sophisticated specification and
capable of carrying out various operations by the Indonesian Air Force, while also
aim to compensate the strength of defense equipment of neighboring countries in the
region. Therefore, until the fulfillment of MEF III's target can be carried out,
Indonesia will not tarnish its relations with its strategic partners, namely the United
States or Russia, and avoid the loss of CAATSA sanctions that Indonesia could suffer
if it chose Russia.
41
Kompas. 2020. “Pengamat Sebut Modernisasi Alutsista Perlu Dipercepat untuk Penuhi Target MEF”.
Kompas. https://nasional.kompas.com/read/2020/10/27/11555191/pengamat-sebut-modernisasi-alutsista-perlu-
dipercepat-untuk-penuhi-target?page=all Accessed 24 December 2020.
The Title II of CAATSA: Russia Key Provisions states that individuals,
entities, or agencies that carry out defense, intelligence, financial, and
energy/resource relations activities with Russia will be sanctioned. However, it
discussed waivers or exceptions for countries entangled in sanctions. Statements
regarding waivers are included in several sections, to be precise in Sections
231 and 236. In Section 231, in particular, the discussion of waiver and delay
requirements. In the contents of the law, it can be seen that there are several basic
requirements for the President's consideration to
determine waivers, namely: waivers are in the national interest of the United States,
the party caught in sanctions stops the cooperation process with Russia, the
sanctioned party will try to reduce the defense equipment produced by Russia, and
able to assure the President of the United States that the party caught in the sanctions
will not reiterate similar cooperation in the future. However, the provision
of waivers by the United States is obtained through a lengthy process in terms of law
and domestic government of the United States to process waiver applications. The
complex process including the submission of a proposal granting exclusion and
cancellation penalties (waiver and termination) by the President of the United States,
hereinafter, enters the review process by the United States Congress which consists of
the House of Representatives and the Senate. The review process usually takes 30
days and will be resulted in a Joint Resolution. During those 30 days, the President of
the United States cannot take a unilateral decision. If the United States Congress
approves the President's proposal for the waiver, a Joint Resolution of Approval will
be issued. The United States Congress can also reject the proposal of the President of
the United States by issuing a Joint Resolution of Disapproval. 42 If the President of
the United States refuses the decision, the President can issue a veto and subject to a
10-day re-review process by Congress to approve or cancel the veto.43
In the 2020 United States Presidential Election, Joe Biden and Kamala Harris
won as elected president and vice president, defeating incumbents President Donald
Trump and Vice President Mike Pence.44 This change of leadership is certainly
predicted to change the policy and approach of the United States to the international
community that has been carried out during Donald Trump's tenure. One of the
changes in approach can also occur in how the United States implements this
CAATSA policy. By mapping or knowing how Joe Biden's approach towards
CAATSA policies, Indonesia can determine the best possible option that can be taken
in the procurement of fighter aircraft defense equipment, whether to buy Sukhoi or F-
16, or seek alternatives outside the US and Russia such as France's Dassault Rafale
and Eurofighter Typhoon from Austria, or continued the procurement of Sukhoi and
applied for a waiver under the provisions of CAATSA, or heeded the request of the
United States by canceling the Sukhoi purchase and buying the F-16.
Conclusion
The CAATSA sanctions caused a complex dilemma and major obstacles for
Indonesia regarding its cooperation with Russia and resulted in lingering delays in the
procurement of Sukhoi Su-35 aircraft. The application of the non-tariff barrier policy
in the form of CAATSA sanctions illustrates the United States' efforts to protect its
domestic defense industry while strengthening the dominance of their defense
equipment in the Southeast Asia region, especially Indonesia.
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