Indonesian terrorists are using their time in jail to recruit and plan new attacks in blatant disregard for prison rules which often are not enforced, a senior security analyst said Wednesday.

International Crisis Group expert Sidney Jones said several of the leaders of a new terror alliance discovered in Aceh province last month had met in prison or through prison contacts.

These included one of the group's chief ideologues, Aman Abdurrahman, who had "conducted regular religious study sessions" and laid plans with other terrorists during his time behind bars, she said.

Abdurrahman was arrested over his involvement in a bomb-making cell in 2004 and was released from Sukamiskin correctional facility in Bandung in July, 2008.

"We went to Sukamiskin and both the wardens and the prison administrators, this was a couple of years ago, were completely unaware of who Aman Abdurrahman was," Jones said.

She said they were not even aware that he was holding religious study sessions with other inmates.

"There is supposed to be a ban on hand phones (for prisoners) but it is not enforced and there doesn't seem to be any capacity to be able to do that," she said, adding that she met one terrorist inmate who had 15 mobile phones.

"I don't think you need a special prison for terrorists, I think you can just use basic control techniques, for example making sure they don't have hand phones in their cells. It shouldn't be that difficult."

Abdurrahman was arrested again recently after police discovered the "Al-Qaeda in Aceh" group, an alliance of extremists from various networks from Indonesia and the Philippines.

Dulmatin, a senior leader of the Jemaah Islamiyah militant outfit who masterminded the 2002 Bali bombings, was shot dead by police in follow-up raids in Jakarta.

Police seized three remote-controlled bomb detonators, firearms and tens of thousand of bullets, including those for assault rifles such as M-16 and AK-47s during the raids.

Jones said Indonesia needed to consider separating hardline ideologues like Abdurrahman from other prisoners and monitoring certain inmates more closely after they were released.