Derwin Pereira, Jakarta – President Megawati Sukarnoputri yesterday ordered her deputy to meet several Muslim clerics and leaders of militant groups to defuse growing anti-American sentiments that were undermining foreign investor confidence in Indonesia.

But Vice-President Hamzah Haz's talks with several of them proved futile as demonstrations continued unabated in the capital, forcing police to fire tear gas, water cannon and blank warning shots to disperse a 500-strong crowd outside Parliament. Police said 10 people were injured while 20 were arrested. Yesterday was a public holiday in Indonesia. It is illegal to hold street protests on public holidays.

Palace sources told The Straits Times that Ms Megawati, playing a delicate balancing act between assuaging the concerns of Washington and those of radical Muslims, had expressed concern during her meeting with Mr Hamzah over the weekend that "things can get out of hand" and derail economic recovery if the government did nothing to calm nerves. Indeed, at a speech in a Jakarta mosque on Sunday night, the 54-year-old leader seemed to be playing to the powerful Muslim gallery when she decried the use of military force in the fight against terrorism.

While she did not criticise Washington directly, her comments ignited speculation that Jakarta was backtracking on its support for the US, just a month after her successful visit there.

She had received a pledge of economic support from the US in return for backing the war on terrorism. Up until then, her government had only said it was "concerned" about the US attacks on the Taleban regime and called for restraint. A member of her Indonesian Democratic Party-Struggle (PDI-P) noted: "The President has pledged her support for the US but she can't openly back a war effort because of a domestic backlash that could be exploited by these groups to undermine her administration."

That appears to be the strategy now as she tasked Mr Hamzah, leader of the largest Muslim party in Indonesia who has lashed out several times at the American strikes, to get the militants to stay off the streets. Said the PDI-P source: "All the footage on television of demonstrators burning the US flag and threatening to kill George W. Bush is bad for Indonesia. It scares away potential investors."

Mr Hamzah met several religious scholars yesterday to register this point. But the meeting did not seem to make any headway. Haji Noor Iskandar of the Nadhlatul Ulama said: "The Indonesian leadership has become too soft on the US. Are they concerned about protecting the interests of the Muslim community or looking after only US concerns?"

Cleric Haji Muhammad Ilyas, who also took part in the meeting at Mr Hamzah's official residence, said: "We respect the wishes of the Vice-President and Ibu Megawati but the government also has to respect our demands."

The President's comments on Sunday also got a cool response from the Islamic Defenders Front (FPI) whose leader, Habib Riziq, said that Ms Megawati was "too late and lacked conviction".

Meanwhile, the White House yesterday played down Ms Megawati's criticism of the military strikes on Afghanistan. White House spokesman Ari Fleischer said: "Our country has been attacked and the United States will take all the appropriate steps to defend itself. That message has been received well by our allies." He denied that global support for the US military campaign was eroding, adding: "The United States will continue to work with our coalition allies, the United States will continue to prosecute the military campaign to achieve our objectives."