South Korea has agreed to transfer a prototype of the homegrown KF-21 Boramae fighter jet to Indonesia, settling a long-running dispute over Jakarta’s delayed payments in the joint development program, according to government data submitted to lawmakers on Tuesday.
The Defense Acquisition Program Administration said in a report to lawmakers that Seoul and Jakarta reached a working-level agreement in February on a revised "value transfer" package tied to Indonesia’s reduced financial contribution to the KF-21 project.
Under the agreement, South Korea will provide one of the six KF-21 prototypes — the fifth aircraft — along with technology transfers, development data and other support, in a package worth about 600 billion won ($400 million), equivalent to Indonesia’s revised share of the program.
Indonesia had originally committed to covering about 20 percent of the development cost, or roughly 1.6 trillion won, in return for corresponding technology and industrial benefits. But payments were repeatedly delayed due to fiscal constraints, prompting negotiations that ultimately cut its contribution to 600 billion won last year.
The prototype to be transferred is a single-seat KF-21 aircraft that first flew in May 2023 and has been used in tests of key systems such as the active electronically scanned array radar and aerial refueling capabilities.
Seoul had previously reconsidered whether to hand over the prototype after Indonesia scaled down its financial commitment. However, the two sides ultimately agreed to proceed with the transfer, partly in consideration of Indonesia’s potential as a future buyer.
A government official familiar with the matter said on condition of anonymity that Seoul opted to provide a prototype — which has limited operational value — rather than transfer sensitive technologies tied to operational aircraft.
"Indonesia is considered a potential export partner, and providing the prototype was seen as a more manageable option than expanding technology transfers," the official said.
Indonesia has so far paid 536 billion won of its 600 billion won obligation, including a recent installment in March. It is expected to settle the remaining balance by June.
DAPA said it will determine the timing of the prototype and data transfer after confirming full payment.
Some observers note that Indonesia’s participation helped push the KF-21 project forward in its early stages by distributing financial risks and providing political backing for the multitrillion-won program.
"Technically, the program could have proceeded independently, but having a foreign partner helped secure early momentum and made it easier to justify the budget," an industry official said on condition of anonymity.
According to reports, Seoul and Jakarta are also in talks about a potential deal to export 16 KF-21 jets to Indonesia, in what could be the first overseas sale of the advanced fighter.
The KF-21 program, an 8.8 trillion won project launched in 2015 as South Korea’s flagship indigenous fighter development effort, aims to produce a 4.5-generation supersonic jet equipped with advanced avionics, including an active electronically scanned array radar, and that is capable of carrying a wide range of air-to-air and air-to-ground weapons.
The aircraft is designed to reach a maximum speed of around Mach 1.8 and is expected to be deployed by the South Korean Air Force starting late this decade.
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