Government ups R&D goal, robotics sector given incentives

In its plans to retool the economy for the future, Thailand’s government made it a goal last week to increase spending on research and development to 4 percent of gross domestic product by 2036 with step-by-step targeted increases along the way, as it also unveiled new incentives to draw more investment to the burgeoning robotics sector.

Thailand’s current spending on research and development (R&D) is low at only 0.5 percent of gross domestic product (GDP) or $1.7 billion, with roughly half of that spent by the government and half by the private sector. The figure is projected to hit 0.7 percent next year.Under the government’s 20-year plan, the initial target is to increase spending on research and development to an average of 1 percent of GDP from 2017-21.  After that, from 2022-26, the average spending would be 1.5 percent. From 2027-31 spending on R&D would be 2 percent, and from 2032-36 it would be more than 2 percent with a goal of 4 percent.

Deputy Prime Minister Prajin Juntong said that the private sector will need to play a key role in increasing spending on research and development. The government expects that an estimated 70 percent of the country’s spending on R&D would come from the private sector as the plan progresses.

The government’s plan to shift the economy towards higher-technology and creativity encompasses more than just spending targets. The plan calls for increasing the proportion of researchers in the population to 80 per 10,000 by 2036, compared to an estimated 12.9 per 10,000 now.

Prajin said the government would need to overhaul the entire R&D spending structure to focus mainly on three areas: competitiveness, enhancement, social issues and improving people’s quality of life.

Incentives from the government and the Board of Investment are components of the plan to spur the shift towards knowledge and higher-technology industries, and last week the government said it plans to start offering new and attractive tax incentives to businesses that buy locally made industrial and service robotics.

“The committee intends to submit the tax proposal to the cabinet for approval within the next two weeks,” said Djitt Laowattana, director of the government’s robotics super-cluster committee.

Under the proposed incentives, businesses that buy robotics from local companies would be allowed to deduct as much as 400 percent of expenses incurred from buying robotics and automation systems.The incentives also aim to attract foreign robotics companies to establish manufacturing bases in Thailand as they would then be considered local suppliers, Djitt said.

According to Nachi Technology, a leading Japanese manufacturer of robotics, the number of robots deployed in Thai factories will double to 8,400 by 2018 from 4,200 now, because of strong demand for robotic technology in the food and food processing industries.