Thai Prime Minister Thaksin Shinawatra said he would allow an open-field trial of genetically modified food in what would be a key step towards commercial use of such crops in the kingdom.

The relaxation of Thailand's existing regulations on genetically modified organisms (GMOs) still requires cabinet approval, but Thaksin said broader experimentation with and use of the strains would be sanctioned under a new biosafety law to be tabled next year.

"We have the capacity to develop genetically modified crops and if we do not embark on it now we may miss our opportunity," Thaksin told his audience during his weekly radio address.

"But we must adhere to the Buddhist middle path ... and use compulsory clear labeling."

Thailand's cabinet in 2001 banned GMO field trials. Current law forbids the public sale of GMO seeds and requires products containing more than five percent of a genetically modified ingredient to be labelled as such.

Thaksin said he felt buoyed by progress in Europe where the EU ended its ban on GMO products, and stressed that Thailand would be successful if it could juggle both GMO and conventional crop markets.

Sakarindr Bhumiratana, a scientist with Thailand's National Center of Genetic Engineering and Biotechnology, said the kingdom was currently testing GMO strains of papaya, chili and orchids for future commercial use.

"The scientists must experiment at the farm level -- the last stage -- in order to assess the impact and ensure that GMO crops can be grown on a commercial scale," he said in an interview on Thai radio.

Last month environmental group Greenpeace, a major opponent of genetically modified foods, accused the Thai government of illegally selling seeds from genetically modified papaya fruit after raiding a state-owned farm.

Other environmental groups slammed Thaksin's announcement as a "mammoth mistake" that could put Thailand's huge agriculture industry in turmoil.

"The policy is putting Thai people at risk," Witoon Lianchamroon, the director of the BioThai Network, said in the Nation newspaper, adding that a countrywide upswell of opposition was likely.

"The premier will take us to the point of no return," he added. "Thaksin has doubled back on his big promise to farmers and environmental groups" to maintain a ban on commercial use of GMOs.