KANDY: Police lined the streets of the Sri Lankan highland town of Kandy on Sunday and the army was on standby as hardline Buddhist monks gathered for their first big assembly since Easter attacks by Islamist militants on churches and luxury hotels.

Galagoda Aththe Gnanasara, the influential head of the Buddhist nationalist group Bodu Bala Sena (BBS), has called for many as 10,000 clergymen from across the country to attend the meet.

The group said the gathering will decide who to back in the presidential elections later this year in the Indian Ocean island nation where Buddhists make up about 70% of the population. The rest include ethnic Tamils, who are mostly Hindus, and Muslims.

Dressed in orange, Gnanasara visited one of Buddhism's most sacred temples in Kandy on Sunday where a relic believed to be the Buddha's tooth is kept. Later in the day, the hardliner, who has faced allegations of inciting violence against Muslims, will address the gathering.

"The army is assisting the police on security under the emergency law," military spokesman Sumith Atapattu said, adding soldiers were on alert should trouble to erupt.

There has been increasing anti-Muslim violence in the country in recent weeks, blamed in part on Buddhist groups, in apparent reprisal for the April bombings claimed by Islamic State that killed more than 250 people.

Muslims have become fearful of a backlash, especially from hardline groups such as the BBS that are leading the campaign against Islamic extremism.

Many shopkeepers and restaurant owners in Kandy said they planned to close their establishments on Sunday for fear of violence.

MJM Faizal, a Muslim who set up the Expo Leather store in Kandy 20 years ago, said late on Saturday he never had a problem with his neighbours even if they belonged to different communities.

"We cannot predict anything because a lot of outsiders are coming to Kandy and we don't know what that means," said the 55-year-old, who said he has been losing business since the attacks in April.

"We are not safe now, there is always tension about what might happen. If we could, we would move to another country," he said, adding that his wife and daughters now do not leave the house alone and are always accompanied by him or his brother.

Kandy was rocked by violence last year when mobs vandalised a mosque, homes and businesses.

"The government is not doing enough for our security and safety," said 42-year-old Mohamed Rilwa, a Muslim businessman who owns the Fancy Point general store that remained closed on Sunday.

"They see all of us the same way ... just because we are Muslims and we have Muslim names," he said, adding that he has lost 75 per cent of his business since the attacks and worries for the safety of his wife and three children.