Korea EximBank Supports $ 1.2 billion to Build Three Indonesian Submarines

09 Juli 2019

Third submarine KRI Alugoro (photo : Kemhan)

Daewoo Shipbuilding & Marine Engineering Co. Ltd. has announced that Korea Eximbank will provide $ 1.2 billion in construction costs for three submarines exported to Indonesia. 

The Korea Export-Import Bank is ready to fund the construction of the submarine, according to a report by the defense industry specialist Media World Net. According to reports, the Export-Import Bank will provide funds to the Indonesian Treasury Department in the form of a loan, and the Indonesian Treasury will support the funds to the PT PAL Shipyard.

"We are expecting the funding rate to be lower than that of the first submarine because the Ministry of Finance appreciates the investment grade of Indonesia well," said Ilian Thorntal, Director of Treasury Finance at the Surabaya Office. 

On April 12, DSME ordered three Type 209-1400 submarines from Indonesia for $ 1.2 billion and jointly with Indonesian shipyard PT PAL. Daewoo Shipbuilding & Marine Engineering Co., Ltd. will be delivered to the Indonesian Navy by the first half of 2026 through joint construction with Indonesian PT. PAL shipyard as in the first project. 

The submarine to be built jointly by DSME is 61m long and can carry 40 crew members. It also has eight launchers that can launch various torpedoes, mines, and missiles. Submarine drying starts at the end of the year as soon as DSME is ready.

Previously, DSME and PT PAL were built in Korea in the Type 209-1400, and the last submarine made a block in Korea and finally assembled at the Indonesian PT PAL shipyard in Suarabaya - Indonesia. The first ship Nagapasa is going out, the second ship is Ardadedali, and the third ship is an Alugoro. The No. 1 and No. 2 vessels have already been commissioned to the Indonesian Navy, while the No. 3 vessels are undergoing marine navigation tests. 

(Global Biz 24)