Thai Navy to Pay in Yearly Instalments for Chinese Submarines

The Royal Thai Navy is pushing to pay yearly instalments for the two diesel-powered Yuan Class S26T submarines it is intending to purchase from China.

Last year, the Navy’s budget was slashed by 4.1 billion baht ($126.15 million) from the initially-allocated 20.5 billion baht ($631 million), or 33% of the annual fund, due to the pandemic.

The submarines were expected to cost around 22.5 billion baht ($684.7 million), with a payment plan spread over seven years beginning this October. The purchase is part of the larger 200 billion baht ($6.08 billion) defense budget being considered by a House scrutiny panel.

The first payment was supposed to have been approved last year. It was postponed so the money could be diverted to fight the COVID-19 pandemic. The Navy is now back at the House to defend the spending again.

"We face resistance whenever the issue is brought before the committee. It's not the first time we've been given a dressing down,” Navy spokesman Chettha Jaipiam was quoted as saying by Bangkok Post on Sunday.

“Disruption to the procurement would affect the submarine fleet structure as 2-3 subs are needed to be commissioned in case one comes in for maintenance and repair," Adm Chettha added.

The Navy has negotiated with China to lower the first instalment by one-third. Details will be presented to the House scrutiny committee and released to the public later, the report said.