The Public Debt Management Office (PDMO) plans to seek a solution for managing hefty debt incurred from the Yingluck Shinawatra government's rice-pledging scheme.
The solution may require cabinet approval to ensure the government's commitment, said Theeraj Athanavanich, a bond market adviser to the PDMO.
The office is waiting for the final debt figure for the rice-pledging scheme from a committee, which will be concluded after the scheme's stockpile is completely sold, he said.
A source who is familiar with the issue said the PDMO once proposed fiscalising the Bank for Agriculture and Agricultural Cooperatives (BAAC) debt incurred from the scheme -- making it state debt -- to Finance Minister Apisak Tantivorawong.
But Mr Apisak said the measure would not be suitable until the real debt is realised after the rice stockpile is completely released.
Luck Wajananawat, former president of the BAAC, said in 2016 that government debt totalling 500 billion baht borrowed from the bank to fund the last government's loss-ridden rice-pledging scheme would take an estimated 16 years to be paid off.
His estimate was based on the assumption that 10-20 billion baht from the annual budget goes to paying down that debt.
The rice-pledging scheme was initiated by the Yingluck government to fulfil the Pheu Thai Party's 2011 general election campaign promises.
Under the scheme, the government bought every single grain of rice at a pledged price of 15,000-20,000 baht per tonne of paddy -- 40-50% above the market rate, hoping the massive stockpiles would push up global prices. But the scheme backfired.
Somsak Kangteerawat, the BAAC's senior executive vice-president, said the Yingluck government directly borrowed 90 billion baht from the bank and secured an additional 410 billion through the bank's bond issuance to finance the rice-pledging scheme.
At the end of January, the BAAC's outstanding bonds amounted to 329 billion baht, while government debt incurred from the bank declined to 80 billion.
Mr Somsak said the government's direct borrowing amount fell at a slow pace, as its interest rate of 1 percentage point, on top of fixed deposit receipts equivalent to 2%, is cheaper than the bonds' coupon rate.
The government has not been in a rush to pay back the debt to the BAAC, he said, as the bank has ample liquidity for business operations.