Stephen Coates, Banda Aceh – Pink from floor to ceiling and with hot pink windows and doors, the office of the Aceh Transitional Committee (KPA) looks more like a perfumery than the nerve centre of a former rebel army.

But the house in Banda Aceh was packed with weather-beaten, chain-smoking men as the demobilised guerrillas prepared for the return Saturday of their exiled hero, Hasan di Tiro, after almost 30 years in Sweden.

The 83-year-old proclaimed independence from Indonesia in 1976, igniting a separatist war which devastated the province on Sumatra's northern tip until the Asian tsunami forced the two sides to agree on broad autonomy in 2005.

The Nobel Peace Prize awarded Friday to former Finnish president Martti Ahtisaari was recognition for his efforts to help broker the historic deal.

But di Tiro's return comes at a sensitive moment in the peace process, with tsunami aid money running out and allegations of intimidation and thuggery – often directed at the KPA – increasing ahead of elections in April.

The KPA is the new body set up to look after former fighters of the Free Aceh Movement (GAM), the rebel force founded by di Tiro which is now known as the Aceh Party.

The party is expected to win most seats in the elections and push for the Helsinki peace agreement to be fully implemented, amid widespread complaints that Jakarta has failed to honour its side of the deal.

"The leaders of Aceh and Indonesia have to use this moment to sit down and talk about the past to make sure the conflict doesn't happen again, like they did in East Timor," politician Mohammed Saleh of the Aceh Unity Party said.

Scores of thousands turned out to hear the frail di Tiro speak at the Grand Mosque in central Banda Aceh on Saturday, where he confirmed his support for the Helsinki process.

But there are different ideas among the Acehnese factions over what to do with the old father of the independence movement, underlining the often bitter struggle for power and wealth which has engulfed the province since 2005.

Many of the demobilised guerrillas and Aceh Party loyalists who meet in the soft pink light of the KPA office think he should be installed as a king-like figure with the historical Acehnese title of Wali Nanggroe.

They say di Tiro has a hereditary right to the post, which should be imbued with the power to sack the elected governor. Other parties argue however that di Tiro has no hereditary claim and the position should be purely ceremonial.

"I want to see him become the Wali Nanggroe," former guerrilla Ruslan Zakaria, 37, told AFP. "I'd like to see a strong Wali Nanggroe with the power to sack the governor... like a king."

Zakaria is one of many ex-rebels who have traded in their guns for menial jobs with aid agencies rebuilding Banda Aceh after the tsunami, under a reintegration plan for former rebels and Jakarta-backed militias.

The agency in charge of reconstruction is due to wind up its activities in April, raising concerns that the election season could see clashes between competing factions using unemployed former combatants as muscle.

"The reintegration process is a mirage," said Aceh Party loyalist Mohammed Nasir.

Kidnappings are common and some analysts estimate up to 15 percent of the billions of dollars in tsunami aid money that has poured into the province is being robbed through extortion on behalf of political and criminal interests.

Politician Saleh said ex-GAM fighters should forget about reinstating di Tiro as a king-like figure and focus instead on providing jobs and democracy as promised under the peace deal.

"This is not the time for egos but to lobby and bargain with Jakarta" for more autonomy, he said over breakfast at the Jasa Saya Solong cafe, across town from the KPA headquarters.

"I don't know if Hasan di Tiro will change anything but I hope he can because in all countries after conflict there is movement from political crimes to plain criminality."

Deputy Governor Mohammad Nazar, of the SIRA party, said the peace deal made provision for a ceremonial Wali Nanggroe but not a powerful new "sultan."

"If they want to do that of course they have to change the law," he said, adding that more important challenges for Aceh included establishing a truth and reconciliation commission and a human rights court.