The United Kingdom and Indonesia have agreed to $5.24 billion (£4 billion) maritime deal, led by British defense firm Babcock.
The agreement is aimed at strengthening Indo-Pacific security dynamics and reinvigorating the British shipbuilding industrial base.
Set to be formally announced by Prime Minister Keir Starmer during a call with Indonesian President Prabowo Subianto from the G20 Summit on Saturday, the deal positions British defense contractor Babcock International at the helm of a comprehensive Maritime Partnership Program (MPP).
The agreement underscores a deepening strategic alignment between London and Jakarta, focusing on maintaining a rules-based international order and freedom of navigation in a region increasingly defined by complex geopolitical tensions.
Bolstering UK Defense Industrial Base
Central to the agreement is the development of maritime capabilities for Indonesia’s Navy, alongside the construction of more than 1,000 vessels for the nation’s fishing fleets. While the vessels will be constructed in Indonesia to stimulate local shipbuilding, the program relies heavily on British design, engineering, and technological expertise.
The UK government confirmed that the partnership will secure 1,000 jobs across the United Kingdom. The majority of these roles will be sustained at Babcock’s Rosyth shipyard in Scotland, with additional positions secured at the company’s facilities in Bristol and the Devonport dockyard in Plymouth.
“This deal with Indonesia is the latest example of how our strong international partnerships are delivering real benefit for people at home in jobs, opportunity and growth,” Prime Minister Starmer said in a statement ahead of the formal announcement. “And as one of our closest G20 partners, it reinforces our joint commitment to global stability and bolsters our shared national security.”
This contract follows a series of major British defense export successes, including a recent £10 billion contract with Norway for next-generation anti-submarine warfare destroyers and £8 billion deal with NATO ally Turkiye for Typhoon fighter jets.
Enhancing Indo-Pacific Stability and Food Security
For Indonesia, the MPP represents a critical modernization of its maritime infrastructure. Beyond naval defense, the initiative addresses President Prabowo’s priority of enhancing national food security by revitalizing fishing communities and boosting seafood consumption through a modernized fleet.
“Through our historic partnership, we will develop and build our vessels domestically, supported by the expertise, experience and technology from the United Kingdom,” President Prabowo stated. “The program marks a new phase in the Indonesia-UK bilateral relationship. This collaboration will mutually drive our economies, create high-quality jobs, and more importantly, advance Indonesia’s shipbuilding and defense capabilities.”
The program is supported by the UK’s Blue Planet Fund, ensuring that future vessels are deployed in an environmentally sustainable manner. This includes initiatives for dynamic fish-stock assessment, marine conservation, and community-led coastal resilience.
Technological Transfer
A key component of the deal is the transfer of advanced technology, including automation and AI, to the Indonesian shipbuilding sector. Babcock International will facilitate collaboration between UK and Indonesian educational institutions to share skills in precision engineering, digital ship design, and integrated naval systems.
Babcock Chief Executive David Lockwood described the deal as a “major investment and commitment” that builds on the strong foundations between the two nations.
“Babcock is proud to be leading the UK’s industrial support for this international program which will advance critical Indonesian naval and maritime programs,” Lockwood said. “We will also generate positive economic impact across the UK, supporting high-value jobs, while stimulating the supply chain and SME opportunities.”
The agreement builds upon recent maritime cooperation, including visits to Jakarta by the UK Carrier Strike Group and HMS Spey, paving the way for greater interoperability and joint training between the Royal Navy and the Indonesian Navy.