Indonesia has signed a $1 billion arms package to update its crumbling military. The agreement with Russia includes contracts for two submarines and contains an option to purchase up to eight more over the next 15 years. As Chad Bouchard reports from Jakarta, that plan is raising concerns among other Pacific nations.
Under the turbid waters of the Western Pacific, a quiet arms race is threatening to upset the fragile balance of power between nations.
Military analysts say Indonesia's deal with Russia last week, which included two of Russia's famously stealthy Kilo-class submarines, is the latest development in an ongoing underwater arms race across the region.
Andrew Davies is the author of The Enemy Below, a report published by the Australian Strategic Policy Institute think-tank.
He predicts increasing underwater traffic could lead to a serious international incident.
"When you have submarine operations, especially if people go and operate in other people's sovereign waters, you have one little accident, you know a submarine bumps into a ship or something like that - and these things do happen; even US submarines bump into ships occasionally, you're setting yourself up for a very significant diplomatic issue, especially if the two countries happen to not like one another," he noted.
Japan has asked Indonesia to explain why it needs so much firepower under the sea.
Designed mainly for use against commercial ships and combat against enemy submarines in shallow waters, the Kilo-class 636 is one of the world's most advanced diesel-engine vessels.
The US Navy has nicknamed it the "black hole" because its engine is so quiet it can slip in and out of detection.
Davies says that kind of equipment makes neighboring countries very nervous.
"The nature of submarines is that people are deeply suspicious of them, and while international law says that if you're in someone else's waters you have to transit on the surface - but that's more honored on the bridge than on the observance, I'd suggest," he said.
Indonesia says it needs to expand its submarine fleet, as part of an effort to modernize the country's military equipment, which has suffered under a floundering economy.
Earlier this year the country's Minister of Defense struggled to get half of his budget funded.
The new line of credit with Russia will provide more flexibility.
Indonesia currently operates two outdated German submarines, which it purchased in the early 1980s.
Indonesia's spokesman for the military, Rear Admiral Sunarto Sjoekronoputro, says increasing naval power is critical for a country of about 17,000 islands.
He says in order to secure the country's maritime borders and preserve Indonesia's sovereignty, two outdated submarines are not enough.
Sunarto says neighboring countries should not feel threatened by Indonesia's expanding submarine fleet, just as Indonesia does not feel threatened by expanding fleets in Singapore, Malaysia and Australia.
He says Indonesia is confident they can work out their disputes diplomatically, but also wants to be able to back up its agreements.
By 2016, Singapore plans to have a total of six submarines, and Australia will upgrade its half-dozen more robust Collins-class vessels.
Indonesia's deal with Russia is also seen as part of efforts to lessen dependence on the U.S. as its chief military supplier. Washington imposed an arms embargo on Indonesia in 1999 over human rights concerns in the country's former province of East Timor. Sanctions were extended in 2002 over the murders of two American teachers at the Freeport copper and gold mine in Papua.
Kusnanto Anggoro, a political and military affairs analyst with Jakarta's Centre for Strategic International Studies, says Russia's arms package comes with no strings attached.
"That is basically a diversification of the defense resources, especially because of the problems that we've had, with the West," noted Kusnanto, "especially the U.S., during the last couple of years. It's improving but at least Indonesia has to show that it has an alternative source for defense."
He adds that Indonesia should make it clear to neighboring countries that the military upgrade is not meant as a threat.
"The new defense instruments - the weaponry and so on - is basically for something like defensive purposes, not for the offense," he said. "So, we need, of course, within the context of other Southeast Asian countries, to build more sort of confidence and trust building."
Defense advisers in Australia are concerned that their country's regional naval superiority is under attack.
Though Australia's Collins-class subs are considered superior even to the Kilo-class vessels Indonesia has on order, Australia lacks the equipment needed to track and detect subs at sea.
Andrew Davies says Russia's deal with Indonesia should alarm military planners in Australia.
"I think Australia's ability to operate against submarines is very poor at the moment," Davies said. "We're about to build some new warships and we're getting to a critical point where we have to make some decisions about our naval helicopters. And I think we have to focus on anti-submarine capabilities in both of those things. We haven't done anything for the last 20 years. Literally nothing."
Davies says China's increasing naval power may be fueling the undersea arms race.
American intelligence officials report that China plans to build five long-range boats capable of firing nuclear missiles with multiple warheads at sea.
With strategically significant waters surrounding the archipelago nation, Indonesia may be in the middle of what some are calling a new arms race in Asia.