Thai government expects to budget US$1.52b in 2015/16 to repay subsidy loans

[BANGKOK] The Thai government is expected to allocate 50 billion baht (US$1.52 billion) of its budget for the next fiscal year to repay loans arising from its rice and rubber subsidy schemes, a senior official at a state-owned bank overseeing disbursements to farmers said on Wednesday.

The military government had introduced a direct subsidy of 1,000 baht (US$32.9) per rai (0.16 hectare) for rice and rubber farmers.

Deputy Prime Minister Pridiyathorn Devakula proposed the allocation of funds in the budget for the fiscal year beginning in October, according to Supat Eauchai, executive vice president of Bank for Agriculture and Agricultural Co-operatives.

"This government will allocate its 2016 budget to repay (the debts) so that it is not a burden for the next government. It will be about 50 billion baht," Mr Supat told reporters.

Prime Minister Prayuth Chan-ocha, who led a May military coup, has said that his government would avoid populist policies that might burden a future administration after a controversial rice subsidy scheme under the previous government of ousted former Prime Minister Yingluck Shinawatra caused billions of dollars in losses to the state.

REUTERS