Thai Prime Minister Abhisit Vejjajiva on Wednesday said he would not complete his term at the end of 2011 but would dissolve Parliament and call for a fresh election by the first half of this year provided that there is no fresh violence.

Domestic Thai politics remain dangerously polarized after antigovernment protests shook Bangkok last spring, and nobody wants to be accused of ceding Thai sovereignty. National elections will likely be held in the next six months, making the situation especially volatile.

The current crisis was sparked by seven Thai activists, including one parliamentarian from the ruling Democrat Party, who crossed illegally into the contested Cambodian-controlled territory on Dec. 29. Cambodian border guards arrested them, and they were locked up in a Phnom Penh jail. Three weeks later, a Cambodian court released five of them on suspended sentences and fined them one million riel ($250) each. The remaining two, still in detention, are charged with trespassing and espionage.

Thai nationalist groups such as the Thai Patriots Networks—a splinter group of the royalist yellow-shirt movement, the People’s Alliance for Democracy—and the Santi Asoke Buddhist sect have seized upon the theme of “lost territories” to legitimize their nationalist hostility toward Cambodia. Some of the Thais who were arrested in December are members of the TPN; Veera Somkwamkid, one of the group’s leaders, is one of the two who remain imprisoned across the border.

At a deeper level, however, the conflict reveals a power struggle between the government and the PAD, the two main bastions of royalism in domestic Thai politics. The PAD is apparently manipulating the border dispute between Thailand and Cambodia to undermine the Democrat-led government of Prime Minister Abhisit Vejjajiva.

says Pavin Chachavalpongpun, a fellow at Singapore’s Institute of Southeast Asian Studies.

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