In the 1980s, the Indonesian government intensified its technology transfer program, this is when the idea emerged to change the status of Pindad to a limited liability company. Based on the Decree of the President of the Republic of Indonesia No. 47 of 1981, the Agency for the Assessment of Application of Technology (BPPT), which was established in 1978, must pay more attention to the technological transformation process established by the Indonesian government, including the procurement of machinery for industrial needs.
The change in Pindad's status is motivated by the limited space for Pindad as an industry because it is bound by regulations and economic dependence on the Ministry of Defense and Security budget so that it cannot develop its production activities. In addition, Pindad is considered a burden on the Ministry of Defense and Security because of the large research and development costs and investments. Therefore, the Ministry of Defense and Security recommends a separation between war making activities dan war support activities. Pindad's activities of producing military infrastructure and equipment are part of the war support activities so it must be separated from the Ministry of Defense and Security and become a limited liability company whose shares are owned by the Indonesian government.
The signing of the handover of the TNI-AD Industrial Management (Pindad) from Kasad General (TNI) Rudini to Prof. Dr. B.J. Habibie April 29, 1983
The chairman of the BPPT at that time, Prof. DR. Ing. B.J. Habibie then formed Tim Corporate Plan (Corporate Planner) Pindad through BPPT No. SL/084/KA/BPPT/VI/1981. TeamCorporate Plan chaired directly by Habibie and consists of elements of the BPPT and the Department of Defense and Security.
As a company, Pindad is expected to be able to produce the military equipment needed efficiently and effectively produce business-oriented commercial products. And has its own costs and budget for development, research and investment as well as developing its industry professionalism.
Based on the results of a study from Tim Corporate Planit was decided that the composition of Pindad's production was 20% military products and 80% commercial or non-military products. Pindad's main task is to provide and produce products needed by the Ministry of Defense and Security, such as light munitions, heavy munitions, and other military equipment to eliminate dependence on other parties. The second main task is to produce commercial products such as machine tools, forging products,air brake system, custom tools and equipment.
On April 29, 1983, the Army Industry officially changed its status from an institution previously under the auspices of the Ministry of Defense and Security to a Limited Liability Company (PT), with a new name as PT. Pindad (Persero). The word Pindad behind the word PT is not an abbreviation but its position is intact as a name. As the President Director, the Minister of Finance appointed Prof. Dr. Ing. B.J Habibie. April 29, 1983 is commemorated as Pindad's birthday to this day.