Robert Go, Jakarta – Governor Syahril Sabirin reclaimed the helm at Bank Indonesia yesterday after a six-month detention period, escalating the three-way power tussle between President Abdurrahman Wahid's government, the Parliament and the country's central bank.

He has promised, with his reinstatement, to consolidate the bank which over the past few months has been battered by his suspension, recent parliamentary inquiries into its activities and the en-masse resignations of five deputy governors. "I have to evaluate the developments of the past five months, but I hope the rupiah will stabilise and strengthen," he said.

Mr Syahril's return takes place at a critical juncture as Parliament is in the midst of debates over how to revise regulations governing the central bank. The administration is also currently pushing to remove the governor and place its own candidates at the head of the bank.

Government officials yesterday predicted that there would be no smooth sailing in the foreseeable future for Mr Syahril, who still faces corruption charges and a possible life sentence over his alleged involvement in last year's 546 billion rupiah (then S$121 million) Bank Bali scandal.

"This release merely follows legal procedures. Syahril Sabirin has many problems," said presidential spokesman Adhi Massardi, referring to the expiry of prosecutors' non-extendable detention orders on Tuesday.

Although prosecutors had yet to set court dates for Mr Syahril, Attorney-General Marzuki Darusman indicated that this spell of freedom would not last long and pledged a speedy transfer of the case to the Central Jakarta court.

But Parliament, which narrowly missed the government's deadline yesterday for deciding on new regulations for the central bank and appointing its new leaders, may ultimately hold the key to this messy saga.

Legislators initially stuck by Mr Syahril when the Attorney-General first pressed charges in June. They gave sympathetic press statements, made public visits to his detention cell, and criticised the administration for attempting to meddle in the central bank's affairs.

Legislators also dragged their feet and rebuffed the administration's demands for a new team to be placed in Bank Indonesia before Mr Syahril's release date. The tactic was meant to ensure the embattled governor's return to the hot seat.

But critics have charged that the entire process of deciding how and who will occupy the top floors at Bank Indonesia might turn into a highly political circus if Parliament has its way.

Senior economist and former adviser to President Abdurrahman, Ms Sri Mulyani, recently warned that Parliament might be seeking to weaken the fiscal policy regulator altogether and place the bank under its direct control. Various MPs have rejected that criticism and have said that their drive to simplify the removal process of central bank governors is aimed at improving accountability at the institution.

But political parties, including Vice-President Megawati Sukarnoputri's Indonesian Democratic Party of Struggle (PDI-P), may already have their own candidates to replace the top leaders in Bank Indonesia. Rumoured to be at the top of PDI-P's list are former ministers Kwik Kian Gie and Laksamana Sukardi, as well as Mr Theo Toemion, who heads the special commission tasked with revising Bank Indonesia rules.

As for Mr Syahril, he will probably face a fairly clear, albeit bumpy, road as government prosecutors have so far been unable to win convictions against two other key defendants in the Bank Bali case.