Thailand Delays Chinese Submarine Deal Over Coronavirus-forced 33% Budget Cut

The Royal Thai Navy has put its plan to acquire two Yuan Class S26T submarines from China on hold, after 33% of its budget was diverted to fund expenses caused by the COVID-19 crisis.

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.

The submarines were expected to cost around 22 billion baht ($677million) with a payment plan spread over seven years beginning this October.

“The proposed budget cut valued at 4.1 billion baht is the largest offered by all the armed forces,” Navy spokesman Prachachart Sirisawat was quoted as saying by local media.

Other naval projects that could be hit due to the budget cut includes construction of a submarine port and the maintenance project for the vessels; the anti-submarine warfare helicopter maintenance and upgrade project; the network-centric warfare system development project; the naval warfare training simulator (NWS) and the secondary weapon system, among others.

Last week, the South Korean Finance Ministry announced a $733 million (904.7 billion won) defense budget cut to fund expenses caused by the coronavirus pandemic. It is expected to push payment schedules for Aegis destroyer systems and for the introduction of F-35A stealth fighters due this year, to next year.