Thailand’s Forest Industry Organisation (FIO) board has stopped the sale of more than 800 million baht worth of timber from its plantations to an Indian firm while investigations are made into alleged irregularities.
The FIO was to export 126,508m3 of teak to India at 6,500 baht per m3, but an FIO employee claimed the timber was being sold too cheaply.
Meanwhile, the Indian company has threatened legal action claiming it is having to pay rent on a ship and a warehouse while the investigation is being carried out.
There are also fears that the problem could strain foreign investor confidence as the deal was supposed to launch the Thai-Indian free trade area agreement which will see customs duty reduced from 40% to 10%.
