Implementation of Trade-off, Local Component, and Offset Policy Pt. Pindad (Persero) in Supporting the Defense Economy

The fundamental problems in economic development in Indonesia are the low level of welfare, unsustainable economic growth, and the inadequate development process of economic sectors. Defense Economics is a branch of science that applies economics to national defense issues. Defense economics as a multidisciplinary study discusses resource allocation, income distribution, economic growth, and political stability as applied to topics related to defense. One of the efforts of the Indonesian government in increasing the capability of the defense industry is to implement a trade-off, local component, and offset policy also known as IDKLO. The Indonesian government in carrying out this mechanism has formed a cooperation with various industrial bodies, locally and internationally such as PT. Pindad (Persero). In carrying out its duties, PT. Pindad (Persero) experienced several obstacles for instance the limitations on the company's high technology mastery in building defense equipment, the availability of funding, and inadequate human resources regarding technical and academic matters. The purpose of this study was to find out how the implementation of the IDKLO policy was carried out by PT. Pindad (Persero) in developing the defense industry. The data collection process is carried out through a literature review method on scientific articles, laws and regulations, as well as PT Pindad's (Persero) annual report related to the IDKLO for the procurement of defense equipment. The results show that the implementation of PT Pindad's (Persero) (IDKLO) is divided into 3 main activities, namely the Ministry of Defense contract with the principal, the principal contract with the defense industry, and the completion of the local component and offsets (KLO) contract. Several variables to support the implementation of PT Pindad’s (Persero) IDKLO are the ability to communicate, its resources, the bureaucracy, and the disposition which could improve the capability of the defense industry of the Republic of Indonesia.

THE ROLE OF DEFENSE ECONOMIC IN ECONOMIC GROWTH

<p class="Els-history-head">The fundamental problems in economic development in Indonesia are the low level of welfare, unsustainable economic growth, and the inadequate development process of economic sectors. Defense economics is a branch of science that applies economics to national defense issues. Defense economics as a multidisciplinary study discusses resource allocation, income distribution, economic growth, and political stability as applied to topics related to defense. According to the defense economy, the impact of the use of the defense budget on the economy can be viewed from the demand or consumption and supply or production approaches. From the consumption side, the defense can protect national resources against various threats, so that national consumption becomes stable and even increases. This research uses role theory according to Biddle and Thomas, among others, Expectation, Norm, Performance, and Evaluation. The research objective is to provide government input on the importance of the economic role of defense in economic growth in Indonesia. Research using qualitative methods is aimed at understanding social phenomena from the perspective of the participants. The result that has been achieved is that the defense economy plays a role in improving security stability, so it is recommended that the government pay attention to defense-security spending budgeting, in particular the adequacy of its allocation, priority level, and linkages between other components</p>

THE DEFENSE ECONOMICS APPROACH TO SYNCHRONIZING DEFENSE AND ECONOMIC DEVELOPMENT POLICIES IN INDONESIA

<p>This study aims to explain the latest phenomenon that economy and defense must be mutually aligned so that people's welfare increases. The main priority is not only improving the economy but also in providing adequate security and defense so that economic actors can carry out their economic activities optimally. The method used in this study is a qualitative study, which has a focus on how to get data and literature that has deep meaning. From this method, we want to get a relationship between the defense and the economic sectors so that both areas must be equally seen as necessary in the ideals of improving social welfare, with the realization that the development of defense and economic programs must go hand in hand.</p>

Politik Hukum Ekonomi Pertahanan di Indonesia Tahun 2002-2018 : Kajian Industri Pertahanan

<div><p>Penelitian ini membahas tentang politik hukum ekonomi pertahanan di Indonesia tahun 2002-2018 untuk kajian industri pertahanan. Kajian studi ekonomi pertahanan dikaji tidak hanya dari wacana ekonomi tetapi dari wacana hukum dan politik. Industri pertahanan merupakan salah satu komponen vital dari kemampuan pertahanan. Industri pertahanan yang kuat mempunyai dua efek utama, yakni efek langsung terhadap pembangunan kemampuan pertahanan, dan efek terhadap pembangunan ekonomi dan teknologi nasional. Rencana induk pengembangan industry pertahanan merupakan penjabaran dari undang-Undang Industri Pertahanan yang menekankan adanya pemberian insentif untuk mendorong perkembangan industry pertahanan di Indonesia.</p>This study discusses the legal politic of defense economics in Indonesia in 2002-2018 for the defense industry study. The study of defense economic studies is examined not only from economic discourse but from legal and political discourse. The defense industry is one of the vital components of defense capability. A strong defense industry has two main effects, namely the direct effect on the development of defense capabilities, and the effect on national economic and technological development. The master plan for developing the defense industry is an elaboration of the Defense Industry Law which emphasizes the provision of incentives to encourage the development of the defense industry in Indonesia.</div>