Indonesia's Danantara Studies 50-Jet Boeing Order for Garuda

Indonesia's sovereign wealth manager, Danantara (Daya Anagata Nusantara), is studying financing options for the acquisition of 50 Boeing aircraft for the nation's flag carrier, PT (Perseroan Terbatas) Garuda Indonesia. The potential Garuda Indonesia Boeing order is a key component of a wider bilateral trade agreement between Indonesia and the United States, which stipulates a significant procurement of American-made aviation assets.

The planned purchase is tied to a US$13.5 billion aviation procurement clause within a broader US$33 billion trade pact. This development marks a significant step in the airline's fleet modernization and expansion efforts following a comprehensive debt restructuring program. For Garuda Indonesia, this potential infusion of new aircraft represents a critical phase of its recovery, aiming to enhance operational efficiency and competitiveness in the growing Southeast Asia aviation market.

Background on the Trade Agreement

The aircraft acquisition is directly linked to the U.S.-Indonesia Agreement on Reciprocal Trade. Investment Minister and Head of the Investment Coordinating Board (BKPM), Rosan Perkasa Roeslani, confirmed the connection. "In this reciprocal tariff agreement, several activities involve the Ministry of Investment and Danantara, including the planned purchase of 50 Boeing aircraft," Roeslani stated.

The deal structure highlights a trend of using bilateral trade agreements to facilitate large-scale aerospace orders, often to address trade imbalances. The mandate for Indonesia to procure American aviation goods and services is the primary driver behind Danantara's involvement in financing the new fleet for the state-owned carrier.

Garuda's Post-Restructuring Trajectory

This potential fleet expansion follows a period of intense financial reorganization for Garuda Indonesia. The airline successfully completed a major court-supervised debt restructuring process, known as PKPU (Penundaan Kewajiban Pembayaran Utang), which addressed approximately $9.58 billion in liabilities. The plan was formally ratified by an Indonesian court on June 27, 2022.

As part of the recovery, Danantara, which was officially launched on February 24, 2025, has already played a crucial role in stabilizing the airline. In mid-2025, PT Danantara Asset Management allocated Rp23.67 trillion to strengthen Garuda's capital structure. The proposed order for 50 new Boeing jets would build upon this foundation, allowing the carrier, which currently operates a fleet of 78 aircraft, to modernize and expand its capacity.

Financing and Delivery Challenges

While the plan is advancing, financing mechanisms and delivery timelines remain under negotiation. Rohan Hafas, Managing Director of Stakeholders Management at Danantara, noted the complexity of the process. "Sources of funds can vary, including supplier credit, allowing installment payments. All of this will depend on future negotiations," Hafas explained.

A significant hurdle is the current state of the global aircraft supply chain. Production backlogs at major manufacturers mean long waiting periods for new aircraft. Hafas acknowledged this constraint, stating that global waiting lists can be as long as seven years. "Technically, we are ready to buy 50 aircraft, but Boeing has not confirmed how many units it can deliver, whether 10, 20, or more," he added. This uncertainty has prompted Danantara to also consider consolidating domestic airlines to improve overall fleet efficiency in the interim.

All new aircraft will be required to operate in compliance with regulations set by Indonesia's Directorate General of Civil Aviation (DGCA) under the country's primary aviation law.

Why This Matters

This move demonstrates a strategic use of a sovereign wealth fund to directly implement national industrial and trade policy. By financing Garuda's fleet renewal, Danantara not only recapitalizes a critical state-owned enterprise but also fulfills a key obligation of a major international trade agreement. The success of this acquisition will be a significant indicator of Garuda's long-term recovery and its ability to compete in the post-pandemic aviation landscape, though it remains constrained by global manufacturing capacity.

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