Pic: AP.

BANGKOK (AP) — China has canceled a deal to buy more than a million tons of rice from Thailand due to a probe into the Thai government’s subsidies for rice growers.

Thai Commerce Minister Niwattumrong Boonsongpaisan said Tuesday that a Chinese state company terminated a contract to buy 1.2 million tons of rice.

He said the company was afraid it would run into problems due to an investigation by Thailand’s National Anti-Corruption Commission.

The rice scheme is a flagship policy of Prime Minister Yingluck Shinawatra’s embattled caretaker government.

Critics say the policy of buying rice from growers at above market prices has accumulated losses of at least $4.46 billion and has been dogged by corruption.

Thousands of farmers have blocked main roads in the provinces to demand overdue payments from the government.

Subscribe to Asian Correspondent

Receive our weekly round-up of the most important stories in Asia

We will never give away, trade or sell your email address. You can unsubscribe at any time.