Its simple, most Chinese aren't usually largely built. Bruce Lee for example, is not a large dude, but everybody knows what he can do. Indian male troublemakers like to bully, and bullies like to pick on small targets, i.e.: smaller-sized men, or women. The Jai Hinds like to make fun of the "small-Chinese", but the ironic thing is that the majority of Indian men are also built around the same size. Its only the Punjabs that are tended to be bigger-built, and the Indian Army like to send their Punjabi Jawans as brawlers against PLA soldiers. It looks better for the cameras, but they also got their asses kicked.
The Chinese are also one of the most picked-on race by racists around the world. And Indians like to gang up on "vulnerable" targets to get some of the bully action. Today its the Chinese, yesterday it was the Muslims. That is why the Jai Hinds deserve no respect.
Depending on the severity. Normally its fines, warnings, and a booking if its nothing too serious, and both parties can settle their disputes, like in this case. If there are broken bones, serious injuries, or death, then there could be jail time and whipping by the rattan stick.
I think the same laws applies to foreigners. Naturally, any foreigner vs local fights is gonna get more attention and hatred. So the public might demand for harsher punishments. Unless the foreigner has some important contacts who might be able to bail them out. The law is easy to bend in Malaysia with money and connections.