The cabinet has approved the much-debated bill on March 19, allowing it to be considered by Parliament in late March.
The bill, which allows the government to borrow 2.2 trillion baht for its infrastructure overhaul, will involve mainly road, air, and maritime transport network developments. The projects include plans to build Thailand’s first high-speed train between Bangkok and Pattaya by 2018 and three other lines linking the capital with Phitsanulok, Nakhon Ratchasima and Hua Hin. All mega-projects would be carried out over the next seven and a half years.
Transport Minister Chadchart Sittipunt earlier said that during the past five years, the country’s investment in infrastructure development accounted for only 15 percent of the budget. According to research by the University of Thai Chamber of Commerce’s Center for Economic and Business Forecasting, the infrastructure projects will be the key factor to boosting the nation's tourism industry, attracting visitors from countries including China, Malaysia, and Singapore, as well as to helping the local economy to expand by 5-7 percent in the next 3-5 years.
The massive borrowing plan drew opposition from Democrat Party members who voiced concerns over possible lack of transparency in management of the budget. Democrat Party leader Abhisit Vejjajiva remarked that the government should finance the projects through its annual expenditure budget, which would be far more transparent. Mr Abhisit also warned that the loan bill will likely conceal the country's real debt status.
In addition to Prime Minister Yingluck Shinawatra’s affirmation that the projects will be graft-free and conducted with good governance, Finance Minister Kittiratt Na-Ranong assured that the implementation of the two-trillion baht loan would be controlled by an executive decree. Mr Kittiratt also confirmed that details of the projects will be scrutinized by the Bureau of the Budget and the National Economic and Social Development Board to ensure transparency and accountability.
He expressed his confidence that the government’s two-trillion-baht mega projects will not affect the country’s public debt, which, even though pushed up by the investment, would still not exceed 50% of the country's GDP. Thailand currently sets its public debt ceiling at no more than 60 percent of the GDP. Additionally, investment in the development of transport networks will eventually cut logistics costs and reduce economic losses for the country.