Thailand has finally agreed to accept the installation of a substitute engine in its Chinese-made submarine rather than a German one, ending a long delay over the troubled project.
In a decision on Tuesday, the country’s cabinet approved changes to the submarine contract, agreeing to the substitution of the previously planned MTU396 German diesel engines with the Chinese-made CHD620 propulsion system. It also extended the construction timeline by 1,217 days.
In 2017, Thailand’s cabinet approved the purchase of a Yuan-class S26T submarine for 13.5 billion baht ($417 million), with delivery expected in 2023. But the purchase ran into trouble when the Chinese state-owned submarine developer was unable to acquire a German MTU396 diesel engine for the boat, due to a European Union arms embargo on Beijing.
Several rounds of negotiations ensued, in which the Chinese side sought to convince the Royal Thai Navy (RTN) to accept a Chinese-made prototype CHD620 propulsion system, which it said would be functionally equivalent to the cutting-edge MTU396 engines manufactured by Germany’s Motor and Turbine Union company. In 2021, construction on the submarine came to a halt, and the boat is currently around two-thirds finished.
Throughout the negotiations, the Thai government mooted a number of alternative options, including canceling the submarine contract and a proposal to purchase a Chinese-built frigate in place of the troubled submarine. It now appears to have accepted the fact that the German-made engine is not feasible, and that pulling out of the project could create unnecessary frictions between Bangkok and Beijing. It is unclear whether the amended agreement involves any compensation from the Chinese side.
In a statement yesterday, the RTN expressed its “gratitude” to the Cabinet for approving the amendment to the agreement. “This allows the Royal Thai Navy to proceed with the submarine procurement project, enhancing its comprehensive naval capabilities across the surface, above, and below water dimensions,” it stated, adding the submarine “will further enhance the country’s security and maritime interests.”
It said that the Chinese engines “have been tested and proven to have performance and safety comparable to or better than previous models.”
Also on Tuesday, the Thai cabinet approved the acquisition of four Gripen JAS 39 fighter jets worth 19.5 billion baht (around $602.5 million) from Sweden’s Saab AB. The Royal Thai Air Force (RTAF) announced plans in June to purchase a total of 12 jets over a 10-year period, as a replacement for its ageing fleet of U.S.-made F-16s and older Gripen JAS fighters.
“The Cabinet has approved the purchase of JAS 39 Saab Gripen to strengthen the Royal Thai Air Force and protect Thailand’s sovereignty,” the RTAF said on its official Facebook page.
Several of the RTAF’s F-16s were used to target Cambodian military installations during the two countries’ recent border conflict, which killed at least 40 people and displaced upward of 300,000. The Cambodian press reported that the Thai bombing actions had led the Swedish government to cancel the upcoming Gripen purchase, although the Swedish embassy in Bangkok later denied the report.
A signing ceremony for the Gripen deal is scheduled to take place in Sweden on August 25.