The KRI Nanggala 402 was participating in a training exercise when it missed a scheduled reporting call, military chief Hadi Tjahjanto said on Wednesday.
The submarine is believed to have disappeared in waters about 95 kilometres north of Bali, he said.
Tjahjanto said the navy has deployed scores of ships to search the area, including a hydrographic survey ship, and has asked for help from Singapore and Australia, which have submarine rescue vessels.
The Defence Ministry said the submarine lost contact after being granted clearance to dive. It said a helicopter later spotted an oil slick near the dive’s starting position.
The submarine was carrying 49 crew members, its commander and three gunners, it said.
An electrical failure may have occurred during the dive, causing the submarine to lose control and become unable to undertake emergency procedures that would have allowed it to resurface, the navy said.
It said it believes the submarine sank to a depth of 600-700 meters (2,000-2,300 feet).
The German-built submarine, which has been in service in Indonesia since 1981, was rehearsing for a missile-firing exercise that was to take place on Thursday. Tjahjanto and other military leaders were to attend.
Indonesia currently has a fleet of five submarines and plans to operate at least eight by 2024.
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