Calls are growing for the government to step in and alleviate the suffering of rice growers.
On Monday, the government responded by launching a programme of low-interest loans designed to encourage farmers to store their crop rather than sell it quickly at lower prices. Farmers will get a “soft” loan of Bt13,000 for every tonne of paddy they store.
Successive governments have used different measures to subsidise rice farmers, often hailed as “the backbone of the country”. The Democrat administration of Abhisit Vejajjiva offered a price-guarantee programme while the last Pheu Thai Party-led government opted for a price-pledging scheme.
In launching its own subsidy programme, the military-led government has acknowledged the necessity of intervening in farm-produce markets to help prop up prices.
Although Thailand’s economy has diversified with growth in trading and service industries, millions still work in the agricultural sector. Many remain devoted to their rural livelihood, but others have no other choice when it comes to earning money.
In order to avert crisis and rising anger among this huge sector of the population, the junta-led government has been forced to adopt a measure – subsidy – that it despises as populist politicking.
The government is currently seeking civil liabilities of more than Bt30 billion from former prime minister Yingluck Shinawatra over her administration’s corruption-plagued rice price-pledging scheme.
But the junta is also facing pressure for once more failing to keep the rice price at a satisfactory level.
There is talk among some government figures that the current administration may have to suffer a loss from its own subsidy scheme.
But whatever the motivation for the scheme, it will be a boon to farmers. Those in power must now make sure that it is rice growers who benefit from the state funds being spent.
Government figures have accused unnamed politicians and rice millers of collaborating in fixing the paddy prices. They claim the collaborators are trying to incite public hatred and opposition against the junta.
Rather than blaming others, the government should focus on tackling the problem at hand and determining its real cause – which is reported to be oversupply.
If that is indeed the case, authorities must adopt a long-term policy of encouraging rice farmers to grow other crops in order to cut the paddy supply.
If, instead, they are confident that the problem is price fixing by rice millers and politicians, the government should design measures that prevent such illicit market intervention.
One thing that isn’t helpful is the kind of off-the-cuff advice that one senior government official gave last week: “If fertiliser is more expensive than rice, then you should switch to selling fertiliser instead.” Although it was later explained that he had not been referring to farmers, such flippant remarks have no place in debate about such a serious national issue.
The government must also guard against the kind of corruption that has blighted previous rice subsidies. This latest programme must not be allowed to become the bonanza for unscrupulous millers, officials and politicians that seems to have cost the country billions in recent years.