It was lack of vision, coupled with prejudicial policy, that the Malaysian Federation ejected Singapore. It is now, to their loss, their greatest policy failure ever adopted -- to cede Singapore. It was based on the the failure of the Tunku's visage to see a multiracial base.
Let us dichotomize Singapore with Malaysia. Singapore is , in essence, a multiracial state; with Chinese, Malays, Indians, and other nationals living in the state. Note -- that it is a depolarized state -- with ethnic groups marrying each other, living with each other, working, communing together. Malaysia, on the other hand, is polarized with their Bumiputra policy set in place. Lee Kuan Yew actually stated in an interview:
"I think if the Tunku had kept us together, what we did in Singapore, had Malaysia accepted a multiracial base for their society, much of what we’ve achieved in Singapore would be achieved in Malaysia. But not as much because it’s a much broader base. We would have improved inter-racial relations and an improved holistic situation.”
“Now we have a very polarized Malaysia, Malays, Chinese and Indians in separate schools, living separate lives and not really getting on with one another. You read them. That’s bad for us as close neighbors.”
Imagine if Malaysia had not expelled Singapore. It would have been a larger version of Singapore , more or less.
Reference:
Transcripts – New York Times/IHT interview Lee Kuan Yew | The Online Citizen