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Thailand should immediately lift a state of emergency imposed during recent political protests to promote reconciliation or frustration could lead to more violence, a think tank said on Monday.
The anti-government protests by supporters of an ousted prime minister turned violent in April and May. Ninety people were killed and almost 2,000 wounded, raising fears for stability and growth in Southeast Asia's second-biggest economy.
Calm has been restored since soldiers cleared the protesters from a central Bangkok shopping area in May. The demonstrators wore red to distinguish themselves from their yellow-clad, pro-establishment rivals.
Analysts say nothing has been done to heal divisions between the rival political blocs.
Critics say while the government calls for reconciliation it is stifling opposition with arrests, censorship and emergency rule in the capital and 23 of its 76 provinces.
The Brussels-based International Crisis Group said emergency rule should be lifted immediately as part of steps towards peaceful elections and the restoration of stability.
"While the red shirts have no opportunity for open and peaceful expression because of draconian laws, their legitimate frustrations are being forced underground and possibly towards illegal and violent actions," the group said in a report.
"The first gesture that might demonstrate a renewed commitment to building bridges would be to unconditionally and immediately lift the state of emergency," it said.
GOVERNMENT TO CONSIDER EMERGENCY
The government is due to consider the emergency on Tuesday. But while it might be lifted in some provinces, it is expected to be extended in Bangkok and bastions of support for former prime minister Thaksin Shinawatra in the north and northeast.
The former telecoms tycoon turned populist politician, who is living in self-exile, was ousted in a 2006 coup and later convicted of graft in absentia.
The red-shirted protesters are largely his supporters, outraged that their hero was forced from power by what they see as an undemocratic establishment.
Thaksin has been charged with terrorism in connection with shadowy black-clad gunmen who mingled with the protesters and battled security forces in Bangkok in April and May, raising the prospect of a country sliding into civil war.
Thaksin denies any connection with the gunmen or financing the protest.
The government has stressed the need for security that it says the state of emergency ensures.
"We will take every concerned voice into consideration but security is our priority. Tourists and investors want security and stability," government spokesman Panitan Wattanayagorn told the Thai PBS TV channel.
Officials point to a series of small attacks, including a blast last month outside the office of a party in the ruling coalition, which wounded one man.
Cambodian authorities said on Sunday they had arrested two Thais who Thai media have reported are wanted in connection with that blast and would send them back to Thailand on Monday.
(Additional reporting by Ambika Ahuja and Prak Chan Thul; Writing by Bangkok newsroom; Editing by Alan Raybould and Ron Popeski)
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