BEIJING - China's far-west Xinjiang region has been struck by a new bout of unrest in the regional capital, Urumqi, reigniting ethnic tensions two months after deadly riots.

With armed riot troops patrolling the streets of Urumqi and an overnight curfew in place, fresh mass protests appeared unlikely on Friday. But the tumult has underscored the antagonism between many Han Chinese and Uighurs that could make China's control of Xinjiang increasingly troublesome and costly.

Here is why:

WHAT'S GOING ON?

Xinjiang is a vast sweep of territory, covering one-sixth of China's land mass. Its population of 21 million is largely divided between Muslim Uighurs, a Turkic people who have long formed the area's majority, and Han Chinese, many of them migrants sent or encouraged to settle there over past decades.

On Thursday, Han Chinese residents massed in Urumqi to express anger over claims that residents were being stabbed with syringes by mysterious assailants.

But the broader background to the protest was ethnic enmity in the city after riots on July 5. At least 197 people died, mostly Han Chinese attacked by Uighurs.

Many Han Chinese said the killings then showed they were receiving inadequate protection and the claims of syringe attacks -- whether true or not -- have fed on those fears.

The government must seek a path between Uighur resentment of controls on their faith and of Han Chinese economic influence and the sentiments of Han Chinese who see Uighurs as coddled by the government.

Many Uighurs say Han Chinese are grabbing jobs and wealth brought by economic growth. Some Uighurs want an independent homeland.

WHY DOES XINJIANG MATTER FOR CHINA?

Xinjiang is thousands of kilometers from China's capital and fast-growing coastal provinces, so unrest there has little immediate effect on most of the country's people.

China, however, sees Xinjiang as a security bulwark that projects its influence into Central and South Asia. They say the region is exposed to the influence of militant Islamists in nearby countries.

Xinjiang also has reserves of oil, gas, and minerals that enhance its strategic value. Beijing rejects out of hand any demands to grant Uighurs full self-rule or independence.

WHERE COULD THIS LEAD?

From a longer perspective, the latest protest underscores the raw distrust between many Han Chinese and Uighurs that could complicate China's policy to maintain its grip on the region.

China's growing economy and strong central state give it the means to control Xinjiang and other troublesome regions. It can easily pay for troops and increasingly sophisticated technology to monitor and control its residents.
But the protest and its calls for the dismissal of Xinjiang's Communist Party secretary suggests increasing politically volatility in the region.

Urbanization, telecommunications, the Internet and social mobility are bringing Uighurs and Han Chinese into closer contact. But they also make it easier for word of protests or alleged injustices to spread quickly within each group, sometimes outrunning security controls.

Beijing has announced no policy shifts in Xinjiang. But when Chinese President Hu Jintao visited late last month, he stressed both stability and economic development.

New economic policies and spending initiatives in Xinjiang could therefore be part of the government's long-term response.

(Reporting by Chris Buckley, editing by Ron Popeski)

China