After years of delays and technical hurdles, the Cabinet decided today to proceed with the 13.5 billion baht submarine deal with China and the use of Chinese-made CHD620 engines, instead of originally specified German MTU diesel engines.
The Cabinet also agreed to extend the contract for the building of the submarines by three years.
Germany decided that it would not permit the export of the MTU engine to China, due to its NATO and EU obligations relating to the export of sensitive technologies.
China had proposed the replacement of the German engines with the Chinese CHD620, but the Royal Thai Navy (RTN) was reluctant to accept the change, because it was unsure of the efficiency of the Chinese-made engine.
In the end, though, it agreed out of concern that cancellation of the contract would mean that the approximately 8 billion baht down payment would be forfeited.
The RTN has also been informed that Pakistan, which has Chinese-made submarines equipped with the same type of engine, has confirmed that the engine works efficiently.
The government-to-government deal is between the RTN and the China Shipbuilding & Offshore International Company for the supply of three Yuan-class S26T submarines.
