This makes the recommendation, by a study group assessing the government's paddy pledging programme, that the Agriculture Ministry should do away with the scheme - the largest government intervention programme in five years - sound like the cart being put before the horse. Any plan to wean rice farmers off subsidies without first solving farmers' indebtedness (and single most serious structural problem) is bound to fail.

Under the paddy pledging programme, farmers place their rice in the care of the Marketing Organisation for Farmers and the Public Warehouse Organisation, the two government agencies involved in the market intervention programme, when the market price is low and redeem it to sell when the price returns to a normal level.

This scheme was designed to help cushion rice farmers against market price fluctuations, with taxpayers' money used to absorb any loss incurred by the farmer if the price drops below the guaranteed rate set by the government. Although the size of the subsidy for the paddy pledging programme has been reduced somewhat in recent years due to improved yields and grain quality, the government still spends over Bt10 billion a year on the scheme.

Besides dealing with farmer indebtedness, the government must carry out comprehensive reforms of the farm sector, including a restructuring of production, distribution and trade. Farmers must be better educated and given access to appropriate technologies, know-how and credit, which would allow them to add value to their farm products. Individual farmers should be encouraged to organise themselves to invest in collective rice grain drying facilities and silos in their respective communities to ensure the grain is kept in good condition, so that it fetches a better price.

At the same time, the government should provide further assistance in the form of research and development to produce improved strains of rice and better quality seeds. These efforts could also be directed at exploring ways in which farmers can add value by processing their produce into new food products, as well as helping them with marketing efforts. It must be made clear that the express purpose of this exercise is to enable farmers to profit from their farming activities so that they are able to raise the funds needed to upgrade their production capacities and expand their businesses.

The scheme, if done right, should help farmers extricate themselves from the vicious circle whereby ignorant farmers with little access to market information and lacking the wherewithal to make a business plan are stuck using outdated and unproductive farming techniques, suffer losses, become indebted and remain trapped in poverty.

Only after all these reform measures have been successfully completed should the government consider removing subsidies for agricultural products. To provide an impetus for change, a timeframe should be set to achieve these policy objectives and all farmers should be registered and given access to training on farming techniques, as well as basic business planning and marketing skills.

Of course, this is easier said than done. Agriculture's share of the country's GDP has dropped from about one-third in the 1970s to around 10 per cent these days. However, the agricultural sector continues to remain important because an estimated 50 per cent of the country's 64 million people still live in rural areas and engage in farming activities.

It cannot be emphasised enough that the key to the success of agricultural reforms hinges on changing farmers' subsistence mindset into a more business-like attitude, with entrepreneurial flair. At a time when Thailand is facing tough competition from other food-producing countries in the global marketplace, the surest way toward self-destruction is for the agricultural sector to stay complacent.