The aircraft will be delivered from this year through 2014.
The contract for the purchase was signed in Singapore on Wednesday by thedirector of the Indonesian Aircraft Maker PT Dirgantara Indonesia (PT DI) and the chief executive officer of Airbus Military during the Singapore Air Show.
Indonesian Minister for Defence Purnomo Yusgiantoro, Commander of the Indonesian Defence Forces (TNI) Admiral Agus Suhartono and a number of legislators were present at the agreement signing.
Yusgiantoro said the signing of the contract was a moment of pride for Indonesia and PT DI.
He said that the first batch of aircraft would be delivered this year and the remaining by 2014.
Purnomo said he did not rule out the possibility of purchasing additional C-295 aircraft. Other units of the Indonesian military were also interested in the aircraft.
"The National Police, for example, is also interested. The C-295 model is for the Air Force and possibly for the Army," he said.