Yingluck\\\'s rice-pledging programme in trouble: Thai farmers protest

Masum Billah | Published: February 15, 2014 00:00:00 | Updated: November 30, 2024 06:01:00

Generous subsidies for farmers were a centerpiece of the platform that swept Yingluck Shinawatra to power in a landslide election  in 2011, but have left Thailand with vast stockpiles of rice and a bill it is struggling to fund. Hundreds of rice farmers have been protesting in the past several days in Bangkok after the Thailand government has repeatedly failed to provide payments under the rice-pledging programme. Delayed payments have already reached 130 billion Baht affecting more than a million farmers.
For five decades, Thailand was the world's largest rice exporter but it has been overtaken by India and Vietnam in recent years. Critics blame the rice-pledging programme for the huge financial losses in the rice sector. The rice protest has intensified the country's political crisis as anti-government protests continue to gather thousands in the streets of Bangkok. Majority of farmer-protesters are not affiliated with the People's Democratic Reform Committee which has been the lead organiser of the anti-government protests. In fact, many farmers are from the village strongholds of the ruling party.
The opposition has expressed support to the protesting farmers and has initiated a donation campaign to help sustain the protest in the city. The opposition is also blaming corruption under the Yingluck government for the present suffering of rice farmers. THSBC Global Connections, a rice-pledging programme, was among the populist policies pioneered by Yingluck's brother, Thaksin Shinawatra, a former prime minister.
He was toppled by the military in 2006. Losses to the taxpayers, estimated at 200 billion baht a year, have fuelled protests against Yingluck and payment problems risk alienating farmers at the heart of her support base in the poorer north and northeast.
After election victory in 2011, Prime Minister Yingluck Shinawatra introduced the programme which  involved the government buying the rice output of local farmers at a high price before reselling the rice to the global market. The programme was meant to improve the savings of farmers but it has become a lightning rod for anger among Yingluck's critics. Yingluck government blames three months of demonstrations on Bangkok's streets for derailing the scheme. Again, her administration's powers have been limited after the dissolution of parliament in December. A controversial election held on February 02, 2014 failed to resolve the crisis with opposition protesters disrupting the polls in parts of the country, in an attempt to stop Yinglucks Puea Thai Party returning to power.
Government critics say the rice subsidies are a wasteful use of taxpayer's money to buy the loyalty of voters in Puea Thai stronghold in the kingdom's north and northeast.
Concerns surrounding rice scheme grew after the commerce ministry announced that a Chinese farm had cancelled a one-million-tonne order for stockpiled rice. The deal broke down after a Thai anti-corruption panel announced graft charges against several officials in relation to the price guarantee program. The National Anti-corruption Commission last month also opened a probe into possible negligence of duty by Yingluck in connection with the scheme.
Defending the  rice scheme, Yingluck told that  the government was trying its best  to keep its  monetary discipline. Thailand is unable to shift its vast rice stockpile -estimated at nearly  20 million  tonnes - saying  a separate  deal with the Chinese  government  still  stands. The contract for one million tonnes is a separate one and China said they would still buy Thai rice. The government will soon auction off another 400000 tonnes of its rice inventory.
Thailand's unfinished election means the current caretaker government cannot create any new debt. The ruling party campaigned on the subsidy plan, which analysts now say has become a spectacular failure. The embattled government came to power pledging increased incomes for rice farmers through a plan that pays up to 40 per cent above market price for all the grain they can sell. The rice-pledging programme encouraged over-production and made
Thai rice uncompetitive for export, ballooning government spending by billions and creating a mountain of stored grain. A Chinese company on February 05 pulled out of a deal to buy over a million tons of stockpiled Thai rice. The collapsed deal struck a blow to the government's efforts to off-load an estimated 20 million tonnes in danger of rotting in warehouses.
The rice-pledging scheme in 2012 cost Thailand the title of world's biggest rice exporter, a position it had held for three decades. Reports of cheaper rice smuggled from neighbouring Burma and Cambodia and sold as "Thai rice" further tarnish the programme's image. The subsidy is an expansion of populist programmes by Yingluck's  brother, former Prime Minister Thaksin Shinawatra, that included cheap loans and affordable healthcare for the countryside.
Anti-government protests have been blocking parts of Bangkok in the latest round of an eight-year dispute that broadly pits Bangkok's middle class, southern Thais and the royalist establishment against the mostly poor, rural supporters of Yingluck and Thaksin. Farmers' protest has added momentum to it giving benefit to the anti-Yingluck protesters. Farmers who took their rice to milling houses received just over 10,000 baht when the price they were guaranteed was 15,000 baht. The present caretaker government, albeit headed by Yingluck herself, does not have the power to do anything that will affect the incoming government. So this issue may take time to resolve.
The writer is Program Manager: BRAC Education Program and Vice-President: Bangladesh English Language Teachers Association (BELTA).
masumbillah65@gmail.com