Mechanical removal of scale can help alleviate the damage caused by the infestation to some degree, but the chances of it remedying the problem are zero. If you're diligent and apply this weekly for 3-4 weeks, it will work: 1 pint very hot water 1 pint rubbing alcohol or ethanol 1 tsp neem oil 1/4 tsp Castile or Murphy's Oil Soap In a 1 quart spritzer, mix the neem, hot water, and sope. Shake well, then add the alcohol. Spritz the tree heavily, keeping the mixture agitated as you spray so it stays emulsified. Use all the mixture that day or discard and wash out the container. Use only pure, cold-pressed neem oil, such as that packaged by Dyna-Gro. You can substitute insecticidal soap for the Castile/Murphy's. Be sure to cover all the plant's surfaces, including undersides of leaves and leaf axils. Al

I think it is a combination of iron deficiency and too wet poor drainage. When I checked the soil it was wet about 3 inches down even though the top few inches was dry. Also, after asking the question the leaves began to get more signs of iron deficiency. I may have lost the thai basil but I gave iron supplement and seaweed solution to everyone and stopped watering for a week. Everybody looks a little better. Good news is that I held off planting all my other basil plants while trying to figure this out. I just planted them this week and last in different garden sections (several with tomatoes, a few on the side of the house in my winter lettuce garden) and they seem to be thriving, even having grown in the few days since transplanting. I would really, really like to have enough basil this summer to put some in the freezer with EVOO/garlic. I like basil more than any other herb, almost more than any vegetable. If I could only grow one thing it would probably be basil and it's been my nemesis forever. Okra got eaten by a bunny this week, BTW and apparently bunnies don't like basil, LOL!

If the whitish, calloused-looking regions aren't squishy but instead almost have a loose-ish feeling, check for root mealies, especially since the damage seems to rise from the ground. If they are squishy and there's no pest activity, it's most likely rot and you must cut above the soft zones to save any of the plant. If there are pests, you will need to treat them immediately, and the plant may make a recovery; however, the cosmetic damage will remain. The final option IMO is sunburn, which would account for the callousing and apparent shriveling IF the affected areas are hard and dry. What is the soil composition like? Didieraceaens like this Alluaudia grow in almost completely inorganic soil in S and SE Madagascar and really can't handle anything much more water retentive than some large grain sand added, or PIG with finer grain... also, do you live in an area with high UV or UV spikes? When I lived in Florida, such UV Warnings were relatively common, and my more sensitive plants or my plants that are slower to acclimate had to be shaded or bake alive! Knowing these and similar things can help us help you :-) also, knowing these things for yourself can help you keep your plants healthy and happy! Just remember that growing plants is a learning experience, and everyone on this website has left a trail of plant corpses in their path as they've learned more about proper care. So keep your chin up :-)

Looks like scale as others have said. Also your soil looks totally wrong, it appears to be very dark peaty and water heavy. Needs to be fast draining and doubt this is...?? Gill