BANGKOK (Reuters) - A resounding opposition election victory could represent a rejection of Thailand's old political order, signaling stability in the short term, but no lasting truce in a long-running battle for power.
Self-exiled former prime minister Thaksin Shinawatra has been dealt a favorable hand with the Puea Thai Party's landslide win, which put his sister, Yingluck Shinawatra, on the brink of the premiership and closed all loopholes for immediate intervention by his opponents in the establishment and military.
Puea Thai's win had much to do with Thaksin's name and political brand and the margin of victory has eased fears of imminent turmoil, but analysts say the rivalry between the billionaire and conservatives is so deeply entrenched that future confrontation is inevitable.
"This election was not the final battle between Thaksin and his enemies. There will be more," said Kan Yuanyong, director of the Siam Intelligence Unit think tank.
"Thailand is still vulnerable. The right-wing elements of the establishment will have no legitimacy if they try to interfere now. They will wait for Puea Thai and Thaksin to slip up, then we'll see them strike back."
Puea Thai had no trouble forming a five-party coalition on Monday and the generals who overthrew Thaksin in 2006 have signaled they will accept his new government, suggesting an accommodation may have been made with the military top brass.
Any attempt to thwart Puea Thai is seen as risky and a potential lightning rod for more unrest. Thailand's stock market and currency appeared to reflect that sentiment, with the bourse gaining 5 percent and the baht rising 1 percent against the dollar on Monday, with foreign investors expected to return following outflows of $1.4 since early May.
However, the revival could be short-lived and with power back in Thaksin's hands, trouble could be on the horizon, especially if Puea Thai seeks amnesty allowing the tycoon to return from exile without serving jail time for corruption.
Thaksin's return would represent another threat to the decades-old influence of the "old money" elite in the running of the country, where patronage and politics is deeply intertwined and powerful alliances with top generals is used to preserve or pull down governments.
That influenced started to wane during Thaksin's spell in office from 2001-2006, but his ouster helped restore the behind-the-scenes role of the military and other unelected powers.
With Puea Thai at the helm, that could all be undone.
Thaksin is keen not to rock the boat and said on Monday he was happy living in Dubai and wanted to retire, with no plans to return as prime minister.
But hardly anyone in Thailand will believe that.
Jacob Ramsay, a Singapore-based consultant with Control Risks, said it was an "absolute certainty" Puea Thai would try to bring Thaksin home a free man.
"They will explore every option now to try to make new rules and look for new ways to get Thaksin the amnesty," he said.
Though not its official policy, Puea Thai's allusions to an amnesty for Thaksin, who is adored as a populist hero by millions of rural poor, may have been decisive in galvanizing his supporters and boosting the party's winning margin.
Yingluck will be under pressure to bring her brother home.
The amnesty issue is extremely divisive. Yingluck has chosen her words carefully, saying amnesty was up to the independent Fact Finding Committee for National Reconciliation (FFCNR) to decide and ruled out special treatment for Thaksin.
But FFCNR chairman Kanit na Nakorn quickly put the ball back in Yingluck's court, saying on Monday it was not his panel's job to discuss or formulate any amnesty bill.
Even if a Puea Thai government is broadly accepted, the amnesty is something that could further divide Thailand.
"I accept a Puea Thai government, if it does a good job," said a bank employee, who asked to be referred to by his nickname, Aud. "But amnesty for Thaksin? Would any other country accept a criminal coming home without going to prison?"
Such a scenario could anger the anti-Thaksin, yellow-shirted People's Alliance for Democracy (PAD), which held crippling blockades and rallies undermining two of the billionaire's governments before the military and the courts sealed their fates.
The PAD has given no indication it will mobilize its supporters against Puea Thai, but it has filed a complaint with the Election Commission calling for the party to be disbanded because of its links to Thaksin, a felon banned from politics.
A PAD-linked group has also targeted Yingluck, calling for a state investigative body to launch a probe into alleged perjury in testimony she gave during an assets concealment case involving her brother two years ago.
The allegations in both cases are not without grounds, legal experts say. They could eventually gain traction given the extra powers the post-coup constitution granted to courts in handling political cases.
Thaksin's rivals are likely to step back for now and let the dust settle to avoid a backlash from his "red shirt" supporters, who shut down parts of Bangkok for nine weeks last year, leading to clashes with troops that killed 91 people.
Another coup would shake Thailand to the core. Analysts see the courts as a more discreet and effective weapon should Thaksin's enemies decide to strike back.
"What would be a surprise is if Thaksin's political opponents do not use existing electoral laws, eventually leading to court decisions, as a way to politically distract, outflank and gradually undermine the broad mandate of Yingluck and her Puea Thai party," Citigroup Global Markets said in a research note.
Editing by Nick Macfie and Robert Birsel