(Reuters) - The chief military advisor of Thailand's anti-government protesters was injured in the head, after an explosion and bursts of automatic gunfire were heard near Bangkok's business district on Thursday night.
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Khattiya Sawasdipol, a suspended army specialist in charge of security at an encampment occupied by thousands of "red shirt" demonstrators, was admitted to an intensive care ward after being shot, said the state Narenthorn Emergency Medical Service.
It had no other details.
Khattiya, better known as "Seh Daeng" (Commander Red) enjoys a cult following among some red shirts and soldiers, but has been dubbed a "terrorist" by Thailand's government, which accuses him of involvement in dozens of grenade attacks that have injured more than 100 people.
The army had earlier said it was planning a huge lockdown around the fortified encampment of the red shirts, who have defied warnings to end their five-week occupation of an upmarket Bangkok shopping district.
The Thai military said it would deploy armored vehicles and shut roads surrounding thousands of defiant protesters on Thursday, forcing businesses to evacuate workers as tensions rise in the deadliest political crisis in two decades.
The army said its armored vehicles will bolster checkpoints, stopping protesters from entering the area, and urged businesses on roads leading into the protesters' 3 sq-km (1.2 sq-mile) fortified encampment to close on Friday.
Army spokesman Sansern Kaewkamnerd said authorities tasked with resolving the crisis will also seek cabinet approval to invoke a state of emergency in 15 northern and northeastern provinces, which are stronghold of protesters to prevent any mobilization.
SURROUND MILITARY VEHICLES
The mostly rural and urban poor protesters refused to leave as their leaders challenged the government from behind medieval-like walls made from tires and wooden staves soaked in kerosene and topped by razor wire.
The government estimated the crowd size at 10,000 but Reuters witnesses put it at more than 20,000.
"We will send out groups to surround these vehicles to prevent them from advancing," Jatuporn Prompan, a protest leader, told supporters. "We believe the army will try to crack down this evening or tomorrow morning."
Companies and embassies across the area told employees to leave work early and activated back-up plans for Friday. Several stations in an elevated train system were shutting early. Public transportation was being diverted from the area.
The mood at the protest site turned quickly in the afternoon from festive to tense. Leaders took turns on the stage to call for more protesters to come to the encampment, chanting "come out, come out" and threatening to lay siege to Prime Minister Abhisit Vejjajiva's house and an infantry barracks where he has taken refuge if there is a crackdown.
Abhisit is under enormous pressure to end the two-month crisis that has killed 29 people, wounded more than 1,000, paralyzed parts of Bangkok and slowed growth in Southeast Asia's second-biggest economy.
But analysts and an army source close to Army Chief Anupong Paochinda said an immediate crackdown is unlikely despite the threats.
"It's hard to say if or when the crackdown will be because we have to evaluate by the hour. We don't want casualties so we have to keep the pressure up so people are too tired to resist.
"Casualties will be bad for us as well."
Analysts said potentially high casualties have prevented the army from going in.
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, though witnesses saw no unusual activity around the sprawling red shirt encampment.
The red-shirted protesters are mostly supporters of former premier Thaksin Shinawatra who was ousted in a 2006 coup. They say Abhisit lacks a popular mandate after coming to power in a controversial parliamentary vote 17 months ago with support from the military.
The prime minister on Wednesday canceled a proposed November 14 election under his "national reconciliation" plan and called off talks with the protesters, raising speculation of a crackdown.
Foreign investors have turned negative since violence flared in April and 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. It seems like we're heading back to square one," said Sukit Udomsirikul, a senior analyst at brokerage Siam City Securities.
Disparate views among protest leaders -- from radical former communists to academics and aspiring lawmakers -- make it difficult to reach consensus. Many face criminal charges for defying an emergency decree and some face terrorism charges carrying a maximum penalty of death.
Several harbor political ambitions and need to appease rank-and-file supporters. Others fear ending the protest now would be a one-way ticket to jail. Some hardliners advocate stepping up the protests to win the fight once and for all.
The red-shirted protesters, have said they would only disperse if a deputy prime minister faces criminal charges over a deadly April clash between troops and protesters.
(Additional reporting by Ploy Ten Kate; writing by Jason Szep and Ambika Ahuja; editing by Bill Tarrant)
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