Indonesia's covert action against West Papuan rebels could easily trigger a firefight between Indonesian and PNG forces. And Australia will be dragged into the confrontation. Paul Daley reports.

It is the ultimate nightmare military scenario for Australia. The troubled Indonesian province of West Papua, home to a burgeoning military operation against pro-independence OPM rebels, shares a porous and hopelessly guarded border with Papua New Guinea.

Troops from Indonesia's special forces, Kopassus, are operating covertly and with virtual impunity on both sides of the border, as they track down and assassinate OPM guerillas. Kopassus members and agents from the Indonesia's state intelligence agency, the Badan Intelignen Negara (BIN), are so well established in PNG that they virtually run some towns.

A badly depleted PNG Defence Force can mount only skeleton patrols. Border security is effectively left to the Indonesians.

One day, while a Kopassus unit is chasing the rebels inside PNG, they come into contact with a PNGDF patrol. A firefight ensues and members of both units are killed.

The conflict escalates and both countries send reinforcements. Before long, Australia is dragged into a messy border conflict with Indonesia, not least because a 1987 Declaration of Principles between Canberra and PNG stipulates the "expectation that Australia would be prepared to commit forces to resist external aggression against Papua New Guinea".

Sound far-fetched? It's not. Many of the conditions are already in place: Kopassus and BIN are well-established inside PNG; they are hunting and killing rebels and there are few PNG patrols of the border.

There's just one thing missing – a clash between the PNGDF and Kopassus. Or is it?

Australian intelligence and security analysts are examining a border clash between PNG troops and a group of Indonesians in a fishing boat just inside PNG's maritime border last week.

It happened close to the PNG villages of Wutung and Mushu – areas that have been subject to recent operations by Kopassus and members of the Indonesian intelligence services. One Indonesian was killed and two were seriously injured. Seven Indonesians were arrested.

Amid suggestions that some of the men were plain-clothed Kopassus agents, PNG's high-level provincial intelligence committee met urgently to consider the implications of the clash. The governments of PNG and Indonesia both insist that the Indonesians were fishermen.

It's no secret that the Howard government's recent embarrassing failure to introduce even harsher measures to deal with asylum-seekers deeply disappointed the Indonesian government.

The laws were, after all, drafted largely in response to growing anger in Jakarta that Australia was becoming a haven for refugees from West Papua, where the Indonesian campaign to quash the independence movement has gone on for decades. But the truth is that even if the government's Migration Amendment Bill had become law, it would not have deterred West Papuan refugees.

For them the question is simple: is it better to risk death at the hands of Kopassus or find themselves in a virtual prison on Nauru while their claims to enter Australia are assessed? Australians can expect more West Papuans as the Indonesian military steps up its overt and covert military operations.

Meanwhile, some Australian defence intelligence officials are deeply concerned that a reshuffle of Indonesia's military command, a massive Indonesian covert military and intelligence operation on the PNG side of the West Papua border, and the recent clash between the PNGDF and the purported Indonesian fisherman, is dramatically raising tensions in what has long been regarded as a dangerous flashpoint for Canberra.

The increasing repression of agitators for independence and autonomy in West Papua is also reinforcing Canberra's view that while Jakarta may be embracing democratic ideals, the Indonesian military – TNI – remains largely a law unto itself.

Despite the fishing boat confrontation in waters just inside the PNG border, Australian intelligence sources maintain there is evidence of serious collusion between Port Moresby and Jakarta over OPM rebels inside PNG.

"Intelligence operations are routinely being conducted inside the PNG border by the Indonesian military's special forces and, it is understood, with a blind-eye approach being taken by Port Moresby," a security source told The Bulletin.

"The Indonesian military knows that a large number of OPM rebels and their supporters are situated on the PNG side of the border. There are a huge number of Indonesian agents as well as plain-clothed Kopassus, posing as fishermen and logging industry workers, inside the border regions of PNG. Some PNG citizens have been co-opted into helping the Indonesian military ... At worst, PNG is cooperating, at best it is doing nothing because the PNGDF is run down and the government is afraid of Jakarta's military."

Australian and other international officials have also been monitoring large-scale illegal logging operations in West Papua of the precious merbau – or red wood – trees. The timber is shifted across the border where it is classified as logged in PNG, before being illegally exported. A big drug and prostitution trade has grown around the illegal logging operations, security sources say.

While the TNI has long faced allegations – most recently by the New York-based Human Rights Watch – that it is heavily involved with illegal logging and associated activities in West Papua, an intelligence source said some senior figures in PNG were also implicated.

The source said that Australia's Defence Signals Directorate had intercepted phone calls from Jakarta to a senior officer in the Indonesian Embassy in Port Moresby inquiring about payments to PNG counterparts.

Earlier this month TNI's general chief of staff, Lieutenant General Endang Suwarya, instructed his defence chiefs to arrest any servicemen believed to be involved in illegal logging or timber smuggling.

Three groups in West Papua are being treated as one by the Indonesian military, and equally persecuted, says the Australian intelligence source. The groups are those in the independence movement, those seeking autonomy for the province, and those who simply want a much smaller Indonesian military presence.

Australian security figures had "noted with great interest" the promotion of Major General Zamroni as the military commander for West Papua, the source said.

"Zamroni's appointment as head of military operations in West Papua proves that ... Indonesia's democratically elected leaders are not in controll of the military, which runs as a law unto itself. Australia can expect to see more vicious repression in its backyard and, therefore, more refugees," the source said.

Zamroni was a commander of Kopassus "anti-terrorist" operations under President Soeharto. He was instrumental in quashing student democracy protests of the mid- and late 1990s when dozens of Indonesian students were arrested and subsequently disappeared. He later commanded Indonesian military operations in Aceh province when TNI was accused of gross human rights violations against separatist activists.

During an offensive against Acehnese rebels in 2001, Zamroni was reported as saying: "This is a dilemma for us. Should we resort to the repressive tactics? People have yet to forget their suffering from military action in the past and so they will hate us. I admit that we may have committed human rights violations and I cannot blame the Acehnese either if they hold a grudge against us. But we've tried to change now, can't they forgive us?"

The Free West Papua Movement in Australia says Indonesian agents are operating with impunity within PNG. During a recent 30-day visit to the border regions of West Papua, the organisation's Nick Chesterfield encountered Indonesian special forces and spies on the border.

West Papuan refugees in PNG were not safe, he said in a detailed report that has been passed to several federal departments. "The refugees' immediate security situation is grave to say the least," he wrote. "The Indonesian military have intensified their efforts to hunt down and capture the refugees. We have received many reports around Wetung [in PNG] of special platoons ... being drilled to capture them extra-territorially and their position within PNG is not secure. Vanimo [a PNG border town] is almost completely overrun with the TNI and BIN and even as a staging point for movement [of refugees] to other locations in PNG, this is not secure.".

"We do not wish for any of these... high-risk refugees to remain in Vanimo for longer than 24 hours as they are at grave risk of kidnapping or assassination. The TNI have been moving weapons utilising ... timber vessels and operations, and ... they have completely infiltrated normal daily life in Vanimo."

Chesterfield said 400 West Papuan students were missing. "And we genuinely fear out of this, 202 have been killed," he said.