Police use water cannon to stop Malaysia protest

KUALA LUMPUR, Mar 26 (Reuters) Malaysian riot police used water cannon today to break up a demonstration against fuel price increases, the latest in a series of rare anti-government protests in the capital Kuala Lumpur.

At least seven people were arrested during the rally outside the 88-storey Petronas Twin Towers.

About 300 protesters, led by the country's largest labour centre, the Malaysian Trade Union Congress (MTUC), chanted anti-government slogans and called for lower fuel prices.

Riot police, some on horseback, used water cannon when protesters ignored orders to disperse.

''It was a peaceful protest. Nobody created unrest, we do not see the reason for the arrests. Our government is very intolerant of peaceful protests,'' said MTUC Secretary-General G. Rajasekaran.

The government last month raised pump prices of petrol and diesel by about a fifth, as part of a long-term plan to cut 1.2 billion dollars in fuel subsidies that are burning a hole in its budget.

Since October 2004, the regulated pump price of petrol has jumped 40 percent and diesel has doubled.

Opposition parties staged several protests after the latest fuel price increase, the first significant anti-government demonstrations since the late 1990s when financial and political crises provoked major street protests.

REUTERS CH KP1050