Thai-Chinese submarine deal faces axe: PM Prayut

Phuket [Thailand], April 9 : Thailand's procurement of a submarine from China could be cancelled after a German company said it was unable to supply the needed propulsion system, according to the country's Prime Minister Prayut Chan-o-cha.
"A huge government-to-government submarine procurement deal faces the axe, if China is unable to fit the engines specified in the purchase agreement," PM Prayut Chan-o-cha had warned last Monday.
Prayut was answering reporters' questions following reports that a German company had refused to supply MTU396 diesel engines to China to be fitted into the S26T Yuan-class submarine being built for the Royal Thai Navy (RTN), Bangkok Post reported.
According to the media outlet, the Prime Minister had instructed the navy to do its best to get the deal over the line, but if China could not fulfil the agreement, the contract would have to be scrapped.
Asked if he was concerned the issue would be brought up in the planned no-confidence debate, Gen Prayut said was he prepared as he had justified the purchase already several times in response to questions.
"What do we do with a submarine with no engines? Why should we purchase it? If the agreement can't be fulfilled, we have to figure out what to do. Isn't that how we solve a problem?" he replied.
When asked if the government can terminate the contract, he said the matter will be considered by authorities concerned and in line with the procurement process and the prime minister need not intervene at every stage, Bangkok Post reported.
Last Saturday, navy commander Adm Somprasong Nilsamai said no changes had been made to the submarine deal and insisted China would have to comply with the contract as signed, as per the media outlet.
Under the terms of the deal, the submarine's engines were to be supplied by Germany's MTU, but the company were barred from making the sale due to an embargo as they are designated a military/defence item.