Thailand plans to cancel submarine contract with China.

According to information published by India Blooms on December 1, 2022, the Thai government is planning to renege on a contentious submarine contract with China if the requirements of the procurement cannot be completed.
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Keel laying ceremony of the first Yuan class submarine for the Royal Thai Navy. (Picture source: ifeng)

On 2 July 2015, the Royal Thai Navy (RTN) formally selected China's Yuan-class (Type 041) platform to meet a requirement for three submarines. The RTN's procurement committee voted unanimously in favour of purchasing the submarine, which has been designated S26T (Thailand), a modified export version of the Yuan class.

On 1 July 2016, the RTN submitted a funding plan for its 36 billion baht submarine procurement project to the cabinet for consideration with the expenditure to be spread over 11 years.

If approved, the first submarine would be bought for 13 billion baht between fiscal years 2017–2021. The second and third submarines would be purchased during the remainder of the 11-year period.

In May 2017, the Royal Thai Navy and Thai Government signed a contract for one S26T variant of the submarine in a $390 million deal. Orders for an additional two submarines are expected in the coming years. Steel cutting ceremony of the first S26T submarine was held on 4 September 2018 at Wuhan, China.

However, Germany refuses to export, for political reasons, the MTU 396 diesel engine which was planned to propel the submarine. To fill this gap, China has proposed its own CHD620 engine, which Thailand has so far refused.