While he did not rule out the possibility of an attack, he noted that Singapore was in a stable neighbourhood and had good intelligence cooperation with its neighbours.

He was responding to a question on whether Singapore could face a terrorist attack like the one in Mumbai last week, given that there are radical elements in countries very close to Singapore.

'It can happen. We take this possibility very seriously,' he said, citing the security precautions taken at major events. But these were not enough.

Also needed was 'a secure environment in the region, good cooperation among neighbours and good intelligence, depending also on our neighbours'.

'So that if anything is picked up, we have early warning and we can nip it in the bud, as we were lucky and able to do with the Jemaah Islamiah (JI) group a few years ago, and as we continue to be on the watchout for in Singapore,' he said.

In 2001 and 2002, Singapore detained some 30 members of the JI planning terror attacks here.

Singapore had 'good intelligence cooperation' with its neighbours, Mr Lee said. But it should never think that an attack can never happen.

He noted that India's neighbourhood was 'more complicated than Singapore's', citing the tribal areas in Pakistan, the disputed Kashmir state and Afghanistan as trouble spots.

Mr P.S. Suryanarayana, correspondent for India's The Hindu paper, asked him if India's neighbourhood had a bearing on events in Mumbai.

Mr Lee said he went by what he read in newspapers, but noted that 'the Indian view is that it has something to do with it'.

Afghanistan has been a base for global terrorism, with Al-Qaeda having been there.

'Regardless of the Mumbai connections, you have issues in your neighbourhood,' he said.

'And of course you have also to manage the Muslim-Hindu relations within India to make sure they are harmonious and make sure that does not become a factor contributing to domestic sources of problems.'

On whether Singapore will recalibrate its engagement with India, he said such engagement is driven by long-term policy considerations that do not change.

To another question, he said he did not expect any tensions between Indians and Pakistanis here: 'If you look at the response in Singapore, all racial groups have come out quite clearly and condemned the attacks in Mumbai. Everybody understands this is not our quarrel. We have to be united in dealing with the threat of terrorism and I think all groups in Singapore understand that extremely well.'

ZAKIR HUSSAIN