Mark Forbes, Jakarta – Jailed leaders of Jemaah Islamiah are using Indonesian prisons as a recruiting ground and publishing house, translating radical Islamic texts and distributing them across the country to indoctrinate future terrorists.

The translated jihadist manuals are being widely distributed, says Sidney Jones, a leading expert on JI and the Asian director of the International Crisis Group. Ms Jones's warning yesterday was endorsed by the counterterrorism chief of Indonesia's Security Ministry, Ansyaad Mbai.

Major-General Mbai said there was a "real and present" terrorist threat in Indonesia, despite the arrest of 300 terrorists and the killing of master bombmaker Azahari Husin last year.

A covert "de-radicalisation" campaign was under way, secretly using former senior JI figures to persuade potential terrorists against turning to violence, he said.

However, terrorist leaders were using the internet from inside prison to issue instructions and to call for more attacks against the West. General Mbai said the terrorists had even managed to convert some of their prison wardens.

Ms Jones said Imam Samudra, one of the Bali bombing leaders on death row, was still using a mobile phone from his cell despite controversy caused by revelations that he had been using a laptop to issue calls for jihad over the internet.

JI had splintered over the past three years, with the hardline bombers headed by the fugitive Noordin Top at odds with the group's mainstream that was trying avoiding immediate violence. But JI was proving resilient in the face of police crackdowns, Ms Jones said. "There is a lot of recruiting going on," she said.

Convicted terrorists were using their prison cells to translate Arabic jihadist manuals, including instructions on forming terrorist cells and carrying out attacks. "The universality of these manuals is worrying," she said. "They focus on Muslims being persecuted and oppressed by colonialists."

The manuals were being distributed as pamphlets, books, and over the internet, she said. Several publishing firms linked to senior JI figures were publishing hardline texts, which were being sold through bookshops in Jakarta.

Samudra had written a book with a print run of 12,000, large for Indonesia. Much stricter controls on materials going into and out of Indonesian prisons needed to be introduced, Ms Jones said.

The terrorist threat from JI had lessened because of police action, Ms Jones said, but it was likely there would be more bombings in Indonesia.

It was worrying how easily terrorists such as Top had been able to recruit sympathetic Muslims, she said. "There were more volunteers for suicide bombers than they could use [for the second Bali bombing]."

With the splintering of the JI leadership, small cells were independently undertaking terrorist attacks, Ms Jones said. She gave the example of a cell in Poso which beheaded three Christian schoolgirls this year.

General Mbai said law enforcement alone could not halt terrorism. He declined to give details of Indonesia's "deradicalisation" campaign because doing so could undermine it. He defended the Government's failure to ban JI, saying it was a political decision designed to avoid disrupting a newly formed democracy.