(Recasts, adds PAD leader)
By Pracha Hariraksapitak and Ed Cropley
BANGKOK Oct 7 Thai riot police fired tear gas
and stun grenades after a day of street battles with
anti-government protesters on Tuesday in which two people were
killed and nearly 400 were injured.
The military put troops on the streets to back up the
police, but the unarmed soldiers showed no desire to disperse
the thousands of demonstrators from the People's Alliance for
One man was killed by a car bomb and a female protester died
as the PAD intensified its four-month campaign to unseat a
government they say is the illegitimate puppet of ousted premier
Army chief Anupong Paochinda denied rumours of a coup, two
years after the military removed Thaksin in a bloodless putsch.
"People should not panic. Soldiers will not launch a coup
since it will not be good for the country," he told reporters.
The clashes began shortly after dawn when police used tear
gas to force a path through 5,000 PAD members blockading
parliament to disrupt the opening session.
By nightfall, 381 people had been injured, 48 seriously,
after the worst street violence since the army and pro-democracy
activists fought in 1992.
Two policemen were shot and another stabbed during the
unrest, which occurred mainly in Bangkok's administrative zone
and did not spill into tourist areas.
Deputy Prime Minister Chavalit Yongchaiyudh, the
government's chief negotiator with the PAD, resigned, saying
police failed to exercise the restraint he had requested.
"Since this action did not achieve what I planned, I want to
show my responsibility for this operation," he said.
After the army announcement, the PAD, an extra-parliamentary
group of businessmen, academics and activists, began pulling
back to the Government House compound it has occupied since
But youths continued to taunt police, who randomly fired
stun grenades at the jeering crowd.
The PAD accuses new Prime Minister Somchai Wongsawat of
being a proxy for Thaksin, his brother-in-law, and vowed to keep
campaigning until he dissolved parliament.
It argues Thai democracy has been undermined by billionaire
Thaksin, who skipped bail in August and fled to Britain to
escape corruption charges, and his allies. It has called for
"new politics" that would include a proportion of appointed MPs.
"We will stay on, we will fight on," PAD leader Sonthi
Limthongkul told a cheering crowd at Government House.
Analysts predicted more political stalemate.
Ramkhamhaeng University analyst Boonyakiat Karavekphan said
the PAD did not have enough support from the military or general
public to deliver a knockout blow to the government.
"If Anupong was on its side, the PAD would have won by now,"
he told Reuters.
The unrest has hurt investor confidence and distracted
policymakers when they should be focused on slowing economic
growth and fallout from the global credit crisis, analysts say.
Citing the protests, traders said the baht currency fell
against the dollar and the stock market tumbled, although in
both cases the credit crisis was also a major factor.
The baht was at 34.51 per dollar, down from 34.38 on Monday.
Stocks fell 4.2 percent to a five-year low, failing to get a
lift from a big Australian rate cut.
Somchai has sought a dialogue with the PAD but there seems
little prospect of a compromise to end the political stalemate.
In his speech to parliament, he called for national
"This government is determined to tackle economic problems
and to listen to all sides to find a solution to end the
crisis," said Somchai, who was forced to leave by helicopter
after protesters surrounded the parliament grounds.
(Additional reporting by Nopporn Wong-Anan and Adrees Latif;
Writing by Darren Schuettler; Editing by Alan Raybould)