The agreement was signed at the Finance Ministry on Tuesday (May 3) by Mr Arkhom and the chief representative of Jica’s Thailand office, Morita Takahiro, reports the Bangkok Post.
According to the agreement, the loan is to be repaid within 15 years - plus a four-year grace period - with the interest set at 0.01%.
The loan is intended to boost Thailand’s public health capacity, help fund COVID-19 treatment and ease the economic pressure on citizens.
It was signed after Mr Arkhom exchanged diplomatic notes with Japan’s ambassador to Thailand on Monday.
The loan will boost relations between both countries and support the recovery of the economy, the source said.
Meanwhile, a Thai-Japanese joint committee will be formed to oversee a new defence agreement signed on Monday, according to Arjaree Sriratanaban, director-general of the Foreign Ministry’s East Asian Affairs Department.
The agreement will enable the transfer of defence hardware and technology from Japan to Thailand.
Ms Arjaree said the agreement will form the framework for equipment and technology transfers, as it outlined procedures and highlighted issues which need to be considered in such transfers.
“As for the details on what kind of weapons [Japan] is going to transfer, they will be discussed at a future date,” she said.
“This agreement is a step forward in promoting defence cooperation and investment, as Thailand is keen to further develop the sector,” she said.
The agreement had been discussed for over five years and Japan had concluded similar agreements with the Philippines, Vietnam, Malaysia and Indonesia.