Gary LaMoshi, Denpasar – Muslim extremists have been convicted of the bombings that left 202 dead in Bali last October and which devastated Indonesia's tourism industry. Now, they're making another assault that's legal but potentially more damaging.

Justice and Human Rights Minister Yusril Izha Mahendra, who advocates turning Indonesia into an Islamic state, is spearheading a campaign that would further depress tourism by slashing eligibility for free visas upon arrival. At present, passport holders from 48 countries and territories can get a 60-day visa without a fee when they enter the country. Current visa eligibles include Indonesia's leading tourist sources – Japan, Australia, the United States and European Union countries, plus up-and-coming Taiwan.

Under a Presidential Decree originally slated to take effect on March 31, passports from only 11 countries would entitle holders to free visas on arrival. That list includes Indonesia's comrades in the Association of Southeast Asian Nations (ASEAN) Thailand, Malaysia, Brunei, Singapore, the Philippines and Vietnam, plus Hong Kong, Macau, Chile, Peru and Morocco – a list that represents a tiny fraction of Indonesia's current tourist arrivals.

Rules for the new policy haven't been issued yet, but Mahendra has declared a December 1 deadline for implementation. The latest reports – which change more often than the weather forecast – say nationals of 23 countries will be able to obtain 30-day visas upon arrival, with a 15-day extension available.

Entry fee Those visas would carry a price tag, though, variously reported as US$20, $30 and $50. The fees would be payable in cash at ports of entry, meaning these charges couldn't be hidden in airline tickets under the term "taxes and fees". Immigration officials at Bali's Ngurah Rai International Airport are busy constructing new booths for fee collection; Mercedes-Benz dealers (and smugglers) are likely drooling. Tourism-industry leaders criticize the new visa policy for hitting them when they're down. Bomb-blasted Bali, which still drives the $5 billion industry and relies on visitors for up to 80 percent of its jobs and incomes, is leading the charge with demonstrations, coalition-building with industry stakeholders in other regions and lobbying in Jakarta.

Industry figures show that international arrivals fell nearly 40 percent in the first eight months of this year compared with 2002. "We are in trouble," John M Daniels, head of Bali Discovery Tours, told an industry forum on Saturday. "We are in a depression." Daniels recalled trying to sell Bali to a convention group of 3,000 people and facing the visa issue: "How do I explain that extra $150,000 they need to budget?"

Or membolehkan makan kue

Mahendra's answer: hotels should give visitors free rooms, restaurants free meals, tour operators free trips. Now you know how to say "let them eat cake" in Bahasa Indonesia.

So what is the point of the new visa proposal? The official reasons of visa abuse by tourists – isolated cases, which fees won't stop – and reciprocity don't make sense. One rumor making the rounds is that during a visit to Australia last year, airport security screeners forced Mahendra to remove his shoes. As a result, he vowed revenge for this show of disrespect, or so the story goes. While the proposed changes would inconvenience and annoy some Australian and other tourists, the real victims would be Indonesians in the tourist industry.

More specifically, the victims would be predominantly based in Bali. The Bali bombings didn't just depress tourism, they further complicated its political distress, which hinges on tension between predominantly Hindu Bali and overwhelmingly Muslim Java and the rest of Indonesia. Initially, sympathy for Bali's tragedy was great, and it prompted a rush from leaders to distance themselves from Muslim radicals. Nearly a year later – and just a year ahead of presidential elections – some of that sympathy has given way to resentments old and new.

A policy that targets Westerners and hurts Bali could be an irresistible populist two-fer for Mahendra and his Crescent Star Party (PBB by its Indonesian acronym), which advocates turning Indonesia into an Islamic state. Western visitors (the diversions they bring and those that cater to them) plus Bali's 3.5 million Hindus represent obstacles standing between PBB and its goal.

Fringe festival

Events over the past two years, but especially during 2003, have increased Indonesian Muslims' sense of grievance and victimization. politicians as well as Islamic leaders continuously assert that the overwhelming majority of Indonesian Muslims are moderates, yet they are increasingly unwilling to denounce those few extremists spewing hate. They may have learned that from US primary election candidates who play to their parties' fringes, since they are the ones most likely to turn out and persuade like-minded people to go to the polls.

Politicians across the spectrum understand the strategy and now play both sides of the terrorism issue. Along with browbeating police for security lapses, a parliamentary hearing this week grilled National Police Chief Da'i Bachtiar over the arrests of 13 alleged terror plotters. The legislators' complaints echoed those publicized by the Indonesian Ulema Council (MUI) and Abu Bakar Ba'asyir's Indonesian Mudjahidin Council (parading the detainees' covered, cowering wives before cameras). MUI, recognized as a mainstream organization, previously denounced the four-year sentence against Ba'asyir handed down this month. An emerging revisionist myth is that recent terror attacks are the fault of Westerners, not the Indonesians doing the bombing.

In a further sign of the shifting political winds, several major tourism-industry groups based in Jakarta, including the Central Hotel and Restaurant Association and the Association of Indonesian Tours and Travel Agencies (ASITA), have refused to join hands with the Bali-led campaign against the new visa rules.

President Megawati Sukarnoputri, who enjoyed overwhelming support in Bali in 1999, has opted to skip next month's Bali bomb anniversary ceremony. Whispers are that she wants to snub Australian Prime Minister John Howard, who plans to attend the memorial service. The real thinking may be that there aren't many votes to be won from standing with Bali or Western terror victims and a great many Muslim votes that might be lost. By the way, it was Megawati who signed the Presidential Decree on the new visa rules, but no one expects her to explain her actions.

Whatever the intentions of Mahendra and Megawati, the new visa rules will hurt the whole Indonesian economy, not just Bali's Hindus. The delay in implementing the new rule suggests that someone high up understands that. If pandering to extremists sets the stage for yet another deadly terror strike, the impact will be even more devastating. There are few signs that any Indonesian leader understands that, and such figures are less likely to emerge as election days draws closer.