The very unsophisticated handling of an Indian led march for...

The very unsophisticated handling of an Indian led march for recognition of rights on 25 November in KL and the overreaction by the Muslim government of Malaysia has created a tinder box dry environment where the first side to fire will bring the house down.

Malaysian counter insurgency paras are already believed to be planning a campaign against the Indians and this could mean a number of things.

This after all is the country in which Lt.Gen. Peter Walls tested his "winning the hearts and minds" strategy by sending in under deep cover, trained operatives in busy areas to plant explosives kill and maim then blame it on the communists.

Unfortunately although it worked in early Malaya the method failed dismally in South Africa and inZimbabwe and blew up in his face there and turning the tide against pro western government.

With both sides calling the other terrorist (Malaysia is where Bali Bomber and mastermind on the run Noordin Top and his colleuge trained and originated from with government blessing as it was a Muslim cause).

It appears that the stakes are high and the government does not give a hoot. It is religious and Islam must prevail over infidels at any cost.

The Tamils on the other hand are prepared for a war of attrition if necessary. They claim to have endured suffering from being marginalised for being non Muslims for over 5 decades. The reason this particular period is more volatile is because of the recent practice of force marriages of Indian girls to Muslim Malay men and their conversion to Islam and the practice of destruction of Hindu temples by Malay Muslims.

In 1969 it was the Chinese the Maly Muslims targetted using the communist bogey then to justify their murder of more than 8,000 Chinese in two nights of terror. The Tamils though are a different kettle of fish.

This is a new and bolder generation with heroes in the Tamil Tiger movement in Srr Lanka according to Malay police reports if they are to be believed. 8 deaths in custody including 1 Malay muslim has left the population wondering if there is an alternative to civilised dialogue with a desperate government.

The situation is so grave that Lee Kuan Yew former Singaporean prime minister flew recently to India to ask LK Advani the Hindu nationalist supremo to prevail over the Indians in Malaysia who feel they have nothing to lose but everything to gain in an armed struggle now in Malaysia.

In fact it is widely being reported that Singapore has drawn up contingency plans to intervene militarily if it comes to that to ensure their own survival.

Both Malaysia and Singapore have lots to lose with irrepairable damage to their respective economies if a fight ensures. The immediate impact will be a fall in the Straits Times Index as well as the currencies of both countries.

My recommendation is to sell down both KL and Singapore now. It will be too late if a device or even a fire cracker explodes above the expected frequency dynamic range in Malaysia today.

Take out puts on everything out of KL and just the STI in Singapore.