As farmers try to recover from the collapse of the government’s rice policy, academics, decision-makers and voters should closely reflect and re-evaluate rice policy and its objectives. However the present-day political impasse is resolved, the next administration will pursue a policy that affects Thailand’s 4 million farming families and its 65 million consumers.
Much has been written about the rice pledging subsidy and the alternative of an income guarantee. But the discussion has been overly focused on the supply side. While this is important, it is critical to examine how consumers are affected and to bring the group into the equation when designing policy.
The rice policy ultimately failed because the government was unable to increase rice prices enough and sell its rice inventory. Corruption and inefficiency are contributing factors. For a brief period in 2011, as the scheme commenced, wholesale and export prices rose. But they declined after a huge surplus from India overwhelmed the market, beginning in December 2011. Without this Indian factor, the discussion would have been very different.
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