Malaysian prosecutors on Monday dropped attempted murder charges against 31 ethnic Indians who took part in a massive anti-government demonstration, a step that might assuage the feelings of the community protesting against their alleged marginalisation in the Muslim-majority country.

Amid cheers and applause from relatives and friends of the detainees, Attorney-General Gani Patail also dropped all charges against five students who were part of the group of 31 activists of the non-governmental organisation Hindu Rights Action Force (Hindraf), arrested in November.

The charges of causing mischief and illegal assembly remain against 26 of the protesters, all of whom pleaded guilty at the Klang Sessions Court on Monday morning.

All 26 were freed on bail, and will go on trial on December 27.

The so-called 'Hindraf 31' were slapped with the attempted murder charge, punishable by 20 years in jail, for allegedly injuring a policeman during the rally outside Batu Caves, which houses the temple of Lord Murugan.

Hindraf had given the call for the rally, declared illegal by the government, which saw over 20,000 ethnic Indians assemble in front of the iconic Petronas twin towers and outside the Batu Caves on November 25 to protest.

"I could be very strict but I don't think this is the time to be that strict," Gani Patail said adding that freeing them would be the "best course of action" in the public and national interest.

"When we exercise the law we look at what is fair and just. And in my judgment this is the fairest thing to do," the attorney general said.

However, five leaders of the Hindraf are still under detention under the controversial Internal Security Act that allows indefinite detention without trial.

Rights groups protested outside the government's National Human Rights Commission yesterday, calling on the body to appeal for abolishing the ISA. Hundreds of ethnic Indians also converged near a detention centre where the five leaders were held and prayed for the release of all those arrested for taking part in the protests.

Malaysia is a multi-ethnic and multi-religious country with 60 per cent of its 27 million people being majority Malay Muslims, 25 per cent Chinese and 7.8 per cent ethnic Indians, mostly Hindus from Tamil Nadu.

Hindraf is demanding equal treatment for Indians, alleging that an affirmative action programme giving preferential treatment to Muslim Malays is tantamount to racial discrimination. The group also blames Britain for their current woes as their ancestors had been brought to the land as indentured labourers by the former colonial power.