Thai rail starts partial strike in anti-government rally

BANGKOK (Reuters) - Thai rail workers began a partial strike on Thursday, joining a protest by thousands of people barricaded inside the prime minister's official compound whose leaders vowed to stay until his government fell.

As many as 80 train drivers and mechanics at a key rail junction connecting central Thailand to the north and northeast called in sick, disrupting at least five trains and stranding thousands of passengers, state rail officials said.

"We have told our union members to call a leave of absence to join the rally in Bangkok to oust this government, which has been damaging the country over the past seven months," State Rail labor union leader Sawit Kaewvan told Reuters.

Sawit, who also heads an umbrella group of all state enterprises' labor unions which has 200,000 members, said more unions including electricity and water would announce action against the government on Friday.

Prime Minister Samak Sundaravej, who ordered police to break up the rally at Government House on Wednesday, softened his stance after failing to exercise arrest warrants overnight for nine leaders of the three-month-old anti-government campaign. The protesters defied a court order to leave the compound.

"I've told the police not to break up the crowd, but to encourage people to leave," Samak said of the 10,000 supporters of the People's Alliance for Democracy (PAD) camped on the Government House lawn behind makeshift barricades.

"After thorough consideration, it would be too dangerous to do so," Samak told reporters at army headquarters after being forced to abandon his main office this week.

The PAD leaders have been charged with trying to overthrow the seven-month-old government through a violent insurrection, a crime that can carry the death penalty.

"We won't leave Government House as ordered by the Civil Court," said retired general and PAD leader Chamlong Srimuang, whose group planned to appeal against the court order.

"Our demands remain the same -- to have the government resign and to prevent an amendment of the 2007 constitution," he said of the army-approved charter drawn up after the military ousted former Prime Minister Thaksin Shinawatra in a 2006 coup.

PROTESTS

The PAD, a motley group of royalist businessmen and academics, accuses Samak's coalition government of being an illegitimate proxy of Thaksin, now in exile in London.

It also sees itself as a defender of King Bhumibol Adulyadej against a supposed Thaksin plan to turn Thailand into a republic -- a charge denied by both Thaksin and the government.

Earlier protests by the PAD were key to the turmoil that led to the 2006 coup, but several newspapers said this week's storming of government offices and a TV station went too far.

Analysts said the standoff was likely to drag on as long as the government kept its cool.

"As the police have so far shown restraint and resisted efforts to disperse the crowd by force and shoulder the consequences, the PAD is pinning its hopes on some men in green sharing its goal of toppling the government," the Bangkok Post said in a column.

With army commanders pledging to stay in their barracks, investors appear to be ignoring the impasse for now. The stock market rose 1 percent on Thursday, while the baht was flat.

Thai shares have fallen 23 percent since the street campaign began in May amid fears of everything from policy paralysis at a time of stuttering economic growth to bloodshed on the streets.

In an effort to discourage more people from joining the rally, police erected small banners at the gates to Government House reading "No entry as ordered by the court; violators to be prosecuted". Newcomers arriving at the compound ignored them.

(Additional reporting by Ed Cropley; Writing by Nopporn Wong-Anan; Editing by Caroline Drees)