[The United States has signalled that the freeze on US military aid to Indonesia, is about to be lifted. The ban was imposed three years ago because of human rights abuses by the Indonesian military in East Timor. On a brief visit to Jakarta last week, Secretary of State Colin Powell announced an aid package of 50-million US dollars, to help Indonesia fight terrorism, a package which he says is a first step to normalising full military ties.]

Presenter/Interviewer: Tricia Fitzgerald, Jakarta

Speakers: US Secretary of State Colin Powell; TNI faction leader in MPR and deputy leader of the MPR, Lt General Agus Widjojo; Azyumardi Azra, head of Indonesia's State Islamic University

Powell: "The resumption of IMET when we were able to get it all worked out and these other programs are really just the begining ... much more will have to happen in the months ahead as we watch the performance of the TNI and as we make sure that there will be accountability for past actions. Many stops along the way untill we get to a full resumption of military to military activities and co-operation."

Fitzgerald: Colin Powell announcing the relaxation of the US ban on military ties with Jakarta.

The American money is to train and assist the Indonesian police and military and to establish a special police counter-terrorism unit. But just who are the terrorists that the beefed up police force will be targeting is not clear.

Indonesia does have para-military islamic groups, and since the fall of former President Suharto they have been operating more publicly.

The militant laskar Jihad army, which has been active in Ambon in the Maluku Islands, is one and there is the FPI the Islam Defenders Front, which has been attempting to shut down bars and gambling dens in Jakarta's red-light district. It celebrated its fourth anniversary this week.

There has been reports that the Jemaah Islamiah group, which has links in Malaysia and Singapore, is also active.

The head of Indonesia's State Islamic University Azyumardi Azra, who was one of a group of islamic leaders brought in to meet the US Secretary of State, does believe stronger law enforcement is needed to curb the extreme groups.

He says in the past former President Suharto kept a tight reign on them but he says since his downfall the extremists have become more active.

Aszra: "And the Government cannot enforce law and order, so ther is some kind of vacuum in the enforcement of law and order. This cleared a chance for this group to take law into their own hands like Laskar Jihad for instance or FPI for instance, argue that because the government and police have failed to stop the spread of narcotics or something like that and then they take law into their own hands."

Fitzgerald: Some of the Indonesian groups name themselves Hammas and Mujahadeen after Palestinian militants, but Azyumardi Azra says they are home grown rather than linked to any international networks like Osama bin Laden's group.

Azra: "Some of this group claims that they have some 30,000 Afghan Fretlin in Indonesia. I don't think that this number is correct ... or probably there are some ... lets say 10 or 20 Afghan Fretlin in Indonesia, but I don't think that there are were 30,000 Afghan Fretlin in Indonesia. So there is a tendency among this group to assert themselves ... to claim a very bigger claim."

Fitzgerald: Mr Azra, warns the US is in danger of loosing the support of moderate Indonesian muslims if it tries to crack down on the extremists and says they should be kept included in the islamic family.

He says he told Colin Powell, poverty and unemployment are the main cause of the of the rise in extremist groups in Indonesia, and he says many of them are in fact paid militias.

Azra: "Indonesia's government together with the US have to take a positive action in order to address Indonesian economic problem. Because some of the groups ... in fact unemployed people, they have no job, and then sometimes they get paid from any side who can use them."

Fitzgerald: Critics of US military aid to Indonesia say the anti-terrorism funding is just playing into the hands of the Indonesian military, the TNI.

They claim its elements of the military itself who are funding the islamic militias in an effort to stir up trouble to justify the need for a strong military force in Indonesia.

They say Suharto-era pressure groups like Permuda Pancasila, the militant youth arm of Suharto's Golkar Party, are still on the military's payroll but have now changed their uniforms to the white robes of islamic warriors.

For example this week hundreds of supporters of the detained extremist laskar Jihad leader Jaffar Umar Thalib, turned up to support him in court. He was facing charges of stirring up religious violence in the Maluku Islands.

Many of Mr Thalib's supporters had army boots and clothing on under their white islamic tunics.

General Agus Widjojo who heads the military faction of the People's Assembly admits there may be links between the islamic militias and the military, but he claims they are totally unofficial.

Widjojo: "There has never been a command policy coming out of the Military to support these militias. There can be individuals, but because that the term Military or TNI is being inappropriately used, it is used to point out those individuals whom have retired from the Militaries. Secondly there are also those individuals which like in Ambon for instance...where there have been individuals involved in the conflict in Ambon."

"But it is to be seen more as those individuals as local population who have been drawn into the conflict because they were part of the family who were also involved in the conflict. And thirdly I do not claim that we are perfect ... that there are also maybe some disciplinary problems down in the field."