Tensions are rising in Rakhine state where the Myanmar government is re-housing Muslims displaced after ethnic clashes with Buddhists last year.

Hundreds of Buddhist residents in Rakhine -- Arakan state -- protested in the streets of their villages this week against resettlement plans for Rohingya Muslims, a report by the news website Democratic Voice of Burma said.

Residents from around 30 ethnic Arakanese villages near Kyaukphyu township where Buddhist mobs razed several Muslim quarters in October protested openly.

Residents from Kyaukphyu, predominately populated by Buddhist Arakanese and Kaman Muslims who, unlike Rohingya, have Myanmar citizenship, say they won't accept the stateless Rohingya minority they view as "illegal Bengali immigrants," the DVB report said.

Many of the displaced Muslims live in poor conditions in makeshift camps in the countryside and jungle in areas liable to flooding, DVB said.

"Local Arakanese people depend on the area for fishing and they won't accept losing their land," an Arakanese local told DVB. "The (Rohingya) have never been here throughout time and we won't accept them."

Around 735,000 Rohingya live in Rakhine state's northern area, close to the Bangladeshi border, as estimated by the human rights organization Arakan Project, funded by the National Endowment for Democracy.

Rohingya are related to the Chittagonian Bengali in Bangladesh and are distinct from the majority Buddhist population of Myanmar, who are of Southeast Asian origin.

Myanmar laws restrict citizenship to exclude Rohingya, an issue that has caused concern internationally as the country opens up democratically and seeks foreign investment after decades of military rule.

Violence between Muslims, who make up less than 5 percent of the country's population, and Buddhists has spread outside Rakhine.

Police said they had charged six Muslim men over the death of a Buddhist monk during an outbreak of religious violence in the southern central city of Meiktila in March.

During ensuing riots in which more than 40 people died, police were greatly outnumbered and stood back as Buddhist mobs including monks ransacked shops apparently owned by Muslims.

The violence reportedly started over a dispute in a local shop. But apart from the monk, aggression was mostly by Buddhists directed against the Muslim minority and no Buddhists have been charged, a report by the BBC said.

More than 12,000 Muslims have been displaced from their homes since the clashes began March 20.

In a speech to the nation this week, President Thein Sein, a former junta general and now elected politician, again called for peaceful coexistence and pledged to uphold the rights of Muslims.

"Regarding Rakhine, our government will take responsibility for upholding Muslims' fundamental rights" while not neglecting the rights of other groups, he said.

His speech also comes as neighboring countries grow more concerned about an influx of Rohingya refugees.

Bangladesh has received the majority of Rohingya fleeing by land and thousands remain in crowded refugee camps on the Bangladeshi side of the border.

But more and more Rohingya are fleeing by boat to other countries, including Indonesia as well as Malaysia.

Earlier this year the European Union lifted many economic sanctions against Myanmar because of its moves toward democracy.

But a recent report by a U.S. government commission recommended that Myanmar remains on a U.S. State Department blacklist of 15 governments responsible for "systematic" violations of freedom of religion.

In its annual report, the Commission on International Religious Freedoms, a bipartisan advisory board appointed by the president and Congress, said the Myanmar government continues to persecute and discriminate Muslim groups.

The government's actions are despite its favorable moves toward establishing a more open and democratic society since the ending of more nearly 50 years of military rule with relatively free national elections in 2011.

"Ongoing and important political reforms in Burma (the former name of Myanmar) have yet to improve significantly the situation for freedom of religion and belief," the commission said.