Tom Fawthrop – The highly politicized Indonesian military, trained in waging terror during more than 30 years of General Suharto's dictatorship, are among the suspects in last month's Bali bombing, according to a respected Indonesian commentator.

Wimar Witoelar, former spokesman for ex-president Abdurrahman Wahid, claimed "the plot is probably hatched by hardline military rogues. This is certainly an excuse for a military takeover unless it is preempted."

While some Western experts on terrorism have concluded that Indonesian extremists linked to the al-Qaeda network are the major suspects, many Indonesians are not so sure it is that simple. A spate of explosions in the capital Jakarta in 2000 included a huge car-bomb blast in the underground parking lot of the Jakarta Stock Exchange. Two members of Kopassus (army special forces) have been convicted and jailed for that act of terrorism.

Kopassus, Indonesia's counter-insurgency elite, has also been linked to last year's assassination of Papuan leader Theys Eluay in a campaign to suppress the indigenous people's rejection of rule by Jakarta. In the same province of West Papua (formerly Iran Jaya), Kopassus has been implicated in the murder of two American teachers and one Indonesian employed by the US mining company Freeport McMoRan, in an ambush in August near its huge mine. Kopassus has been accused of staging a "freedom-fighter ambush" that could be readily blamed on local tribespeople, known to be strong critics of the US corporation.

US officials have confirmed that they have evidence that senior Indonesian military officials discussed an operation against the US mining company before the August 31 ambush, according to a report last weekend in the Washington Post. These murders and the recent spread of militia to West Papua follow the assignment of General Mahidin Simbolon to take charge of the restive province. Simbolon was one of the key figures who orchestrated the violence in East Timor in 1999.

It appears the Indonesian military has learned nothing from the dirty war that led to such a huge civilian death toll in East Timor. Kopassus officers deployed in rebellious Aceh and West Papua are carrying out the same terror tactics in a desperate bid to prevent these two provinces from breaking away from Jakarta.

Among the suspects in the Bali bombing, two extremist Muslim organizations, Jemaah Islamiyah and Laskar Jihad, both have shadowy links with Indonesian generals.

Since Suharto was toppled in 1998, key military generals with Islamist sympathies have sought to mobilize Islamist militia for their own purposes, according to Australian academic Dr Greg Barton. At this time Abu Bakar Ba'asyir and other Jemaah Islamiyah leaders returned to Java from self-imposed exile in Malaysia. Barton, the author of Abdurrahman Wahid, Muslim Democrat, Indonesian President, points out: "Two years later, in early 2000, when President Wahid sacked General Wiranto over the East Timor post-ballot massacres and began to push hard for profound reforms within the military, non-Islamist, nationalist generals joined forces with generals known to be religious hardliners to use radical Islamist militia to destabilize the Wahid administration."

In troubled regions such as Ambon, Central Sulawesi and West Papua, military-backed militias led by Laskar Jihad have wreaked havoc, greatly increased the level of violence and contributed to the steady erosion of government's credibility. Recently members of the Cokar, an Ambon militia, admitted they had been trained and funded by Kopassus.

Given his weak coalition government, and the military's refusal to accept civilian authority, it was inevitable that Wahid would be replaced as president by the more pliant and conservative Megawati Sukarnoputri, with the full blessing of the armed forces.

The Bali bombing, with a death toll of about 187, has been widely reported as the worst act of terrorism in Indonesian history. Not so, say some of the Balinese residents over the age of 35 whose relatives were among the estimated 70,000-100,000 slaughtered in anti-communist purges in 1965-66.

The tranquil serenity of the island paradise was shattered long before the bomb that ripped through the Sari Club in Bali last month. Then people spoke of "rivers that flowed red with blood". But in the case of the 1965 campaign of terror, the government banned any kind of investigation or accounting for the Balinese Killing Fields. Western governments turned a blind eye to the slaughter because Suharto obligingly opened the country up to US corporations and warships.

John Hughes in his book The End of Sukarno re-creates the landscape in the vicinity of the Bali Beach Hotel, Sanur, as it was in late 1965. "Almost in view of the big new luxury hotel the government had built to woo tourists to Bali stand the charred and blackened ruins of one such village. For their communist affiliations the menfolk were killed. The women and children fared better; they were driven screaming away. The village itself was put to the torch. Night after night the sky flared red over Bali as villages went up in flames and thousands of communists, or people said to be communists, were hunted down and killed." It should be noted that until Suharto's seizure of power in 1965, Indonesia's PKI communist party was a fully legal parliamentary party with no armed force.

Since the mass demonstrations that toppled the Suharto regime in 1998, the democratic agenda that included a cleaning-up and reform of the military has been derailed by various factors. Many of Suharto's key generals remain in leadership positions.

A police investigation into the Bali bombing has so far produced few results, although it was announced on Wednesday that four people had been detained in connection with the crime. Little hard evidence has been established.

However, the airline manifest of Garuda has confirmed that at least two military generals from Jakarta happened to visit Bali just three days before the bombings and that they returned to Jakarta just one day before the Sari Club was blown up. Their movements were confirmed by armed forces chief General Endriartono Sutarto, who claimed that General Djaja Suparman was on vacation, while General Ryamizard Riyacudu, chief of staff, was said to have gone to Bali for "health reasons".

Jakarta human-rights activist Bonar Naipospos told Asia Times Online: "General Suparman is one of the generals who was behind the extremist Jihad groups. He set up militias composed of gangsters and religious fanatics to counter student demonstrations in 1998. One of these militias, Pram Swarkasa, became the embryo of Laskar Jihad."

Two days after the Bali bombing, Laskar Jihad militia suddenly withdrew all its forces from Ambon, and it was announced that the organization was disbanded. Lambang Trijono, who studies Indonesian politics at Gadja Mada University, commenting on the timing, said, "Yes, that is suspicious, yes very suspicious. It makes sense to make a connection like that, because before they even dissolved ... you know ... yes, very suspicious, actually."

A Muslim fighter from Maluku's provincial capital Ambon, who used to fight alongside Laskar Jihad, recently told CNN, "the group was ordered to disband by rogue military generals to hide the generals' involvement with the group." This has been prompted by increased international scrutiny of Indonesia in the wake of the Bali terror attacks.

"These generals backed Laskar Jihad and they acted on their own, outside of the institution," the fighter said. "They are afraid of being found out now that there are so many foreign investigators in Bali." The armed forces officially denies any military was involved in Laskar Jihad.

Before the Bali attack, the US government was seeking to move closer to the Indonesian generals in the so-called war against terrorism and restore full military ties. However, the evidence that sections of the armed forces are themselves a party to terrorism – especially in Aceh and West Papua – has created a policy dilemma.

Many serious crimes in Indonesia go unsolved. The Balinese police chief who heads the investigation enjoys high credibility after his successful inquiry into the murder of Papuan leader Theys Eluay and his courage in bringing charges against Kopassus commando officers.

But this time Indonesian human-rights watchers fear the case is too sensitive. Bonar Naipospos commented to Asia Times Online: "I believe the military is involved in the bombing, but I fear the Bali police chief is in a difficult position and they will not follow leads to high-ranking people."