Vaudine England, Jakarta – Jakarta will cancel its controversial programme of transmigration under which millions of people have been forcibly moved from the crowded islands of Java and Bali to less populated provinces.

Minister of Manpower and Transmigration Al Hilal Hamdi confirmed the change after meeting President Abdurrahman Wahid on Tuesday. "The inter-island transmigration policy will be terminated next year," Mr Handi said. "But what will be put in place is inter-city transmigration." He said a key reason for stopping the programme was the need to avoid more outbreaks of the sectarian conflict between competing ethnic or religious groups that is scarring several provinces.

Though not spelled out explicitly, one reason behind the end to the policy is the unofficial movement of at least one million internally displaced people, partly a result of transmigration.

Transmigration looked like a good idea on paper when former president Suharto started it, as most of Indonesia's 210 million people live on Java, Bali, Madura and parts of Sumatra, competing for resources presumed to be more abundant on outer islands. But a lack of foresight and faulty implementation rapidly turned it into a human tragedy.

Groups of people unable to make a living or seeking a new life with better opportunities were "encouraged" to take up government offers of land, housing and jobs in places ranging from Irian Jaya to Kalimantan. But many found the government promises hollow, as they were left in inaccessible or infertile areas without infrastructure.

Inevitably the programme was seen as an unsubtle attempt to "Javanise" the rest of Indonesia, sparking tensions in provinces that have long resented Java's stranglehold on economic and political power.

Most difficult was the reception given transmigrants by the indigenous residents. Vicious clashes have broken out as original inhabitants have refused to share limited resources with "outsiders". This in turn has forced many transmigrants to flee their designated homes.

Official figures show at least one million Indonesians are refugees in their own country. They are fleeing communal strife or economic hardship and loading new burdens on to an administration barely able to cope.