WASHINGTON, Jan. 7 (UPI) -- Korea Aerospace Industries and Indonesia have reached a cost-sharing agreement for the development of their next generation KF-X/IF-X fighter aircraft.
The agreement was signed by South Korea's only aircraft manufacturer and the Indonesian Ministry of Defense. Also included in the deal was Indonesian contractor PT Dirgantara Indonesia. PTDI will send 100 engineers to South Korea in May to participate in the aircraft's structural development.
Under the agreement, Indonesia will initially front one percent of the bill, with its contribution set to increase to above two percent after 2017, according to Yonhap News Agency.
Antara News reports Indonesia will fund 20 percent of the $7.2 billion program, which aims to replace South Korea's aging fleet of F-4 and F-5 aircraft. Indonesia will procure two squadrons of the aircraft.
"Successful development of the KF-X will expand bilateral ties between South Korea and Indonesia in the areas of national defense and economic cooperation," KAI president Ha Sung-yong said in a statement.
The KF-X aircraft, referred to as the IF-X in Indonesia, will be designed to be a twin-engine 4.5-generation multirole fighter. Under the procurement plan, South Korea ordered 120 planes, and hopes to sell a further 600 planes to other countries, while Indonesia will receive 50.
The fighter is expected to be completed by 2025.