Key Points

Sjafrie made the statement after attending a closed-door meeting with Commission I at the parliament building in Jakarta. He said that the budget will be used to pay salaries of soldiers and employees of the Indonesian National Armed Forces, strengthen the army's main weapon systems, and support other defence sectors related to safeguarding national sovereignty, Xinhua News Agency reported.

"The budget will be absorbed optimally so that its impact can be directly felt by the public," Sjafrie told reporters.

He said that the agreed proposal would be submitted to the Budget Agency for further discussions, and expressed hope that the process would proceed smoothly.

On September 15, Bank Indonesia (BI) said that Indonesia's external debt declined slightly in July to 432.5 billion US dollars, down from 434.1 billion dollars in June.

On an annual basis, external debt grew by 4.1 per cent, slowing from 6.3 per cent in the previous month. The development was mainly driven by slower growth in public sector external debt, along with the strengthening of the US dollar against global currencies, including the rupiah.

Government external debt reached 211.7 billion dollars in July, recording a 9.0 per cent year-on-year increase, lower than June's 10.0 per cent growth. The moderation reflected slower growth in external loans and government securities.

Private external debt remained stable at 195.6 billion dollars, contracting by 0.3 per cent year-on-year, similar to the contraction in June.

Indonesia's external debt structure is considered healthy, with the external debt-to-GDP ratio declining to 30.0 per cent in July from 30.5 per cent in June. Long-term external debt continued to dominate, accounting for 85.5 per cent of total external debt.

BI emphasised that it will continue to strengthen coordination with the government in monitoring external debt developments, ensuring that external debt supports development financing and sustainable economic growth while maintaining macroeconomic stability.

- IANS