By Stuart Grudgings and Siva Sithraputhran

KUALA LUMPUR (Reuters) - Malaysian Prime Minister Najib Razak announced the country's first minimum wage on Monday, moving to regain the political initiative after violence at weekend protests raised doubt about the timing of elections that had been expected by June.

Private sector workers in peninsula Malaysia will receive minimum monthly pay of 900 ringgit ($300) while those in the poorer east Malaysia states of Sabah and Sarawak will get 800 ringgit, Najib said in a television address.

That compares with the 760 ringgit per month that, according to a government survey, roughly represents the poverty income line in Malaysia and the gross pay that workers take home in the manufacturing sector.

The new wage policy, part of Malaysia's plan to achieve rich nation status by 2020, coincides with moves by China, the world's manufacturing hub, to raise minimum wages by at least 13 percent in the five years to 2015.

"The introduction of the minimum wage is a historic moment for Malaysia. The lowest-paid will now be guaranteed an income that lifts them out of poverty and helps ensure that they can meet the rising cost of living," Najib said.

The announcement is the latest sign that the government is preparing for elections which must be called by next March but are expected to be held as early as June.

Clashes between police and protesters on Saturday showed political tension is simmering ahead of the polls that are widely expected to be the closest in Malaysia's history, threatening the ruling coalition's 55-year grip on power.

Najib has been seen as leaning towards a June election but his appeal to middle-class voters may suffer if accusations of police brutality against the tens of thousands of protesters gain traction. However, any political fallout appeared to be limited because protesters were at least partly to blame for the violence, which resulted in hundreds of arrests.

Opposition leader Anwar Ibrahim gave a speech at the rally organized by the independent Bersih movement for election reform and was accused by some ruling party members and state media of inciting the crowd to break through police barriers.

"That proves that Bersih was hijacked and that Anwar was trying to use it as an election tactic," Nur Jazlan Mohamed, a member of parliament for the ruling United Malays National Organization, told Reuters.

Najib's approval rating, at a lofty 69 percent in the most recent opinion poll, tumbled last year after a heavy-handed police reaction to a Bersih rally for electoral reform.

Since then, he has reached out to middle-class and younger voters by abolishing colonial-era security laws and pushing limited reforms of an electoral system the opposition says favors his long-ruling National Front coalition.

BLAME GAME

Protest leaders and the country's opposition blamed the police for an overzealous response and dozens of witnesses gave evidence of police brutality after officers fired teargas and chemically laced water at the protesters.

The government and state-controlled media were quick to put the blame on protesters for the clashes, which began after some demonstrators broke through police barriers blocking them from entering the city's Merdeka (Independence) Square.

"A Show of Hooliganism," read a headline in the pro-government New Straits Times, which carried pictures of yellow-shirted protesters throwing sticks at police and kicking police cars. Najib said that police had been the main victims of the violence, but any accusation of police brutality would be investigated.

Anwar, a former deputy prime minister who was acquitted on charges of sodomy in January, denied inciting the protesters, saying the government was trying to deflect the blame for not fully addressing demands for electoral reforms.

Saturday's protest saw the biggest turnout of the three demonstrations the influential Bersih movement has staged since 2007. Police estimated the crowd at about 25,000 but some news sites put the number at 100,000 or higher.

"The huge turnout has sent one significant signal - there is a groundswell of dissatisfaction with the government and it is now boiling over," said Yang Razali Kassim, a senior fellow at the S. Rajaratnam School of International Studies in Singapore.

(Editing by Robert Birsel)