Islamic State (IS) supporters from the region have also cited the Philippines and the US as targets, Jasminder Singh, S Rajaratnam School of International Studies analyst who has compiled a report on the threat, told The Straits Times.
The development comes as Malaysia last month nabbed a cell with explosives targeting Putrajaya (the country's capital city) and the federal Parliament.
Singapore's Home Affairs Ministry on Wednesday also announced the detention of a 19-year-old student who had made plans to join the terror in Syria and carry out attacks here.
There are now more than 700 fighters from Indonesia and over 200 fighters from Malaysia fighting in Iraq and Syria, Singh noted in the report published this week.
While they make up a small proportion of over 30,000 foreign fighters from 90 countries, the unit scored its first major combat success last month, seizing five Kurdish-held areas in Syria.
He said Malaysian fighters had also seized on local issues like the push for an Islamic penal code to win support.
The unit poses a severe threat to Singapore and South-east Asia, said Professor Rohan Gunaratna, who heads Singapore's International Centre for Political Violence and Terrorism Research.
"It has multiple functions: to train people capable of carrying out attacks in Iraq and Syria, to instigate South-east Asians to mount attacks in their home countries, and to radicalise South-east Asians online, recruit them and physically facilitate their entry into Iraq and Syria," Rohan said.
Muslim leaders worldwide are also leading the effort to counter ISIS, he added.
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