Paul Daley, Canberra – Indonesia's former President Dr B.J. Habibie feared his armed forces commander-in-chief would stage a military coup in October, raising fears among senior Australian diplomats and defence analysts of a possible war with Indonesia.

According to a secret Australian intelligence brief obtained by The Age, "secret reporting" indicated Dr Habibie believed General Wiranto would stage a "creeping coup" against him and declare a state of military emergency if Dr Habibie was re-elected.

The Defence Intelligence Organisation document, marked "SECRET AUSTEO" (Australian Eyes Only) and dated 28 September, said Dr Habibie was trying to persuade General Wiranto to run as his deputy to ward off a coup.

The DIO's advice to senior Federal Government figures, including the Prime Minister, Mr John Howard, and the Foreign Minister, Mr Alexander Downer, came just a week after the first of 5000 Australian troops entered East Timor.

Diplomatic and defence sources told The Age that the warnings led to "real fears" of the "potential for war with Indonesia" because General Wiranto would probably have ignored the result of the East Timor autonomy ballot and bolstered Indonesia's military presence there.

"The implication was clear if there was a coup and Wiranto decided not to give up East Timor after Australian troops had already arrived in their thousands," a diplomatic source said, "there would have been a very real chance of large-scale clashes between TNI (Indonesian military) and Australians. The situation was very tense, very tenuous, until the election result was known. There were real fears, that could not be discounted, of a potential for war with Indonesia."

According to the DIO briefing: "Secret reporting indicates that Habibie is fearful of a 'creeping coup' by Wiranto, and believes that Wiranto intends to declare a military emergency if Habibie is re-elected. Habibie is attempting to persuade Wiranto to be his running-mate, in order to ward off such a move."

Another secret DIO document, dated 15 October, does not discount that Dr Habibie could have been re-elected. Dr Habibie eventually pulled out of the 20 October election.

The 28 September document says the relationship between Dr Habibie and General Wiranto had "deteriorated over the past month" but that Dr Habibie "knows he needs TNI's 38-plus votes to be re-elected and Wiranto needs to keep all avenues to political office open".

An earlier secret DIO report shows that Dr Habibie considered replacing General Wiranto last November, but was afraid of the military's reaction.

"Secret reporting indicates his Government considered replacing Wiranto on Friday. But, although Habibie would probably still prefer Information Minister ... Yunus Yosfiah as ABRI (Indonesian military) commander, ABRI's leadership would not accept Wiranto's removal at this stage," says the document.

While senior Federal Government figures have recently expressed optimism that the Indonesian military's influence had apparently waned with the election of President Abdurrahman Wahid, the 28 September document clearly foreshadowed that General Wiranto would retain significant influence in any new government.

The document said that if General Wiranto was prepared to step aside as TNI commander "to focus on his political ambitions, his replacement would probably be a temporary appointment".

"Wiranto could support TNI Deputy Commander, Admiral Widodo, as a caretaker Panglima (commander). They are close friends, and as Widodo does not have an alternative power base, TNI support would remain firmly behind Wiranto," the document says. "Wiranto would maintain his bargaining power in the political arena only if it was recognised that he still had proxy control of TNI. That would be more likely if Widodo were appointed as caretaker."

After President Wahid's election, Admiral Widodo was appointed defence force commander-in-chief, while General Wiranto was shifted to the similarly influential role of Coordinating Minister for Political and Security Affairs.

Although the 28 September document was prepared three weeks before Mr Wahid's election, its predictions about General Wiranto remain salient because of the political muscle flexed in recent weeks by TNI.

When President Wahid recently said that he would give an act of self-determination to troubled Aceh province within seven months, the military responded that the President was only expressing a private view. The President has since said Aceh will not determine its political future.

Two days ago Admiral Widodo criticised Indonesia's Human Rights Commission for reporting that TNI orchestrated recent militia atrocities in East Timor, claiming the finding was biased.

While Mr Howard and Mr Downer have publicly expressed optimism that TNI's influence has waned under President Wahid, privately they are said to be less circumspect. In a speech last week, Labor's foreign affairs spokesman, Mr Laurie Brereton, said the "renewed assertiveness of TNI" should not be ignored.

"General Wiranto has emerged from the political transition with his power and authority inside the TNI apparently intact. The post of Coordinating Minister for Political and Security Affairs is no longer a resting place for generals leaving the political stage," Mr Brereton warned.