By Ambika Ahuja and Martin Petty
BANGKOK (Reuters) - A rogue general leading a militant wing of Thai anti-government protesters was shot in the head and critically wounded on Thursday night as armed troops blockaded the site of a five-week rally in central Bangkok.
Khattiya Sawasdipol, a suspended army specialist in charge of security at an encampment occupied by thousands of demonstrators, was rushed to an intensive care ward, the state Narenthorn Emergency Medical Service said, adding that at least four other people were wounded in the same area.
Khattiya, better known as "Seh Daeng" (Commander Red), was dubbed a "terrorist" by Thailand's government, which accuses him of involvement in dozens of mysterious grenade attacks that have wounded more than 100 people.
In a separate incident a red shirt demonstrator was shot in the head and feared dead when protesters confronted soldiers next to a park in the Silom business district, a Reuters photographer said. Some protesters hurled rocks and troops fired in return.
Several Thai and foreign reporters said Khattiya was shot while being interviewed by them.
"It's a clear attempt to decapitate the red shirt military leadership," said Anthony Davies, a security consultant with IHS-Jane's.
"It's a smart tactical move that will cause confusion in the red shirts' military ranks and send a message to the leadership that if they don't want to negotiate and come out, they can expect extreme consequences."
When the bullet struck him, Khattiya was inside the barricaded red shirt encampment, facing a road, overpass and a business district with several tall buildings, said the New York Times, which had a reporter interviewing him at the time.
When he was shot Khattiya was answering a question about whether the Thai military would be able to penetrate the area.
Around the same time as the shooting, a loud blast was heard, followed by bursts of automatic gunfire near the heavily guarded business district. Hours later, troops at a nearby park fired into the air as protesters tried to block their movements.
Prime Minister Abhisit Vejjajiva is under enormous pressure to end the violent political crisis that has killed at least 29 people, wounded more than 1,400, paralysed parts of the capital and slowed growth in Southeast Asia's second-biggest economy.
On Wednesday, he cancelled a proposed November 14 election under his "national reconciliation" plan and called off talks with the red-shirted protesters after they raised new demands.
The 22-member red shirt leadership council has struggled to find common ground on how to end the protests and appeared in disarray on Thursday night. Its chairman and several others have not been seen in days.
Former Prime Minister Chavalit Yongchaiyudh, chairman of the protesters' parliamentary wing, the Puea Thai Party, called on the demonstrators to leave the upscale shopping district.
Some hardliners like Khattiya have advocated stepping up the protests to win the fight once and for all. Many face criminal charges for defying an emergency decree and some, like Khattiya, face terrorism charges carrying a maximum penalty of death.
LOCKDOWN ON ENCAMPMENT
The military earlier said it was planning a huge lockdown around the fortified encampment of the red shirts, mostly supporters of former premier Thaksin Shinawatra who was ousted in a 2006 coup. The military said it would deploy armoured vehicles around the protesters' 3 sq-km (1.2 sq-mile) site.
The Cabinet on Thursday approved a state of emergency in 15 northern and northeastern provinces, which are red shirt strongholds, to prevent potential unrest.
The mostly rural and urban poor protesters have adamantly refused to leave their Bangkok encampment and their leaders challenged the government from behind medieval-like walls made from tyres and wooden staves soaked in kerosene and topped by razor wire.
The government estimated the number of people in the encampment at 10,000 but Reuters witnesses put it at more than twice that number.
"We will send out groups to surround these vehicles to prevent them from advancing," Jatuporn Prompan, a protest leader, told supporters after the army announced its lockdown measures.
Companies and embassies across the area told employees to leave work early and activated back-up plans for Friday. Public transportation was being diverted from the area.
Protest leaders pleaded over their radio station for people to come and reinforce the encampment and threatened to lay siege to Abhisit's house and an infantry barracks where he has taken refuge if there was a crackdown.
But an army source close to army chief Anupong Paochinda said an immediate crackdown to disperse the protesters was unlikely.
CONSUMER CONFIDENCE FALLS
The turmoil is shattering consumer confidence, a survey showed on Thursday, suggesting spending in shops and department stores is drying up as the crisis grinds on, a troubling sign for a sector that accounts for half the economy.
The University of the Thai Chamber of Commerce said its consumer confidence index fell by a record 2.6 points in April, the lowest since July 2009. Confidence has fallen for three straight months after rising steadily since the middle of 2009.
The Thai baht fell sharply immediately after the army's announcement it would try to isolate the encampment. Stocks fell one percent, while other Asian markets were up nearly 3 percent.
Foreign investors have sold $584 million in Thai shares in the past six sessions, cutting their net buying so far this year to $607.6 million as of Wednesday.
"The markets have no idea what to make of the situation," said Sukit Udomsirikul, an analyst at Siam City Securities.
(Additional reporting by Chalathip Thirasoonthrakul and Jerry Lampen; Writing by Jason Szep; Editing by Bill Tarrant and Jerry Norton)
