"Who are the terrorists in Indonesia? Conspiracy theories over the Bali bombing are rife in Indonesia"

The second theory, particularly prevalent among Indonesians who live in conflict areas, suggests that the Indonesian military (Tentara Nasional Indonesia, TNI) is the culprit. The TNI has been trying since the fall of Soeharto to reassert its role in government by provoking conflict and then coming in to establish order, proponents of this theory assert. Look how the army backed the creation of Laskar Jihad, the armed militia in the Moluccas, they say, or at the involvement of the army special forces in the death of Papuan independence leader Theys Eluay. The struggle between the army and police for control of internal security has become increasingly bitter and violent in the last year, and a blast on the scale of Bali could swing support in favour of the army. Acehnese and Papuan activists are convinced that the new anti-terror decree will be used primarily against them.

The al-Qaeda theory seems to have a much smaller number of supporters for several reasons. The relentless U.S. pressure on the Indonesian government to act against Indonesian nationals linked to the shadowy Jemaah Islamiyyah network appears to have convinced many Indonesians that their own security agencies would be forced to accept the U.S. version of events. Thus when an Indonesian team returned from interviewing Umar al-Faruq, the man arrested in West Java in June this year whose startling revelations, leaked by U.S. intelligence sources to Time magazine, included a plot to kill Megawati, there was little surprise that the team's information confirmed the details in the Time article.

Likewise, many members of the liberal intelligentsia in Jakarta are worried about the arrest of Abu Bakar Ba'asyir, named by al-Faruq as a key figure in a series of bombings in Indonesia and as a close associate of Hambali, the Indonesian considered a top operative of al-Qaeda in Southeast Asia.

"All the evidence against Ba'asyir comes from people in detention," one journalist told me. "We know all about forced confessions in this country. Why should we believe any of it?"

Another man is willing to believe in an al-Qaeda presence in Indonesia but not in its involvement in the Bali bombing. "Why would al-Qaeda want to blow up Bali?" an Indonesian friend with an American PhD asked me. "They had a safe haven here at a time when things were too hot for them in Singapore, Malaysia, and the Philippines. Why wreck it all in this way?" The two sides of the popular Indonesian response - acceptance of a terrorism problem but scepticism about al-Qaeda - present some serious policy dilemmas for the Megawati government.

It will be politically difficult to use the anti-terror decree to round up terror suspects unless it can present strong evidence to the Indonesian public of their likely culpability, and yet it will be under continued pressure from Western governments, particularly the U.S. and Australia, to demonstrate determination to combat terror. The easiest way to prove determination is to make arrests; the danger is that the arrests could become, or be seen as, arbitrary.

The pressure for quick results is already leading to a restructuring of intelligence agencies. Better coordination between the police and military is highly desirable, especially with contradictory statements coming out of the two nearly every day. (On Friday morning, an army special forces spokesman announced that the identities of the bombers had been determined, whereas a police spokesman in Bali said the perpetrators were still unknown.) The danger is that the army will take the lead role and undermine all the work that has been done in the last three years to build up the police as a civilian agency responsible for internal security. The more the army benefits, the more the theory that the TNI was somehow involved in the bombings in the first place will gain credence - and the more the scepticism about an al-Qaeda role will grow.

As long as many Indonesians believe the U.S. was responsible, there will be no incentive for radical Muslims attracted to Ba'asyir-style teachings to disassociate themselves from jihadist views. The horror at the casualties in Bali is deep, and if it could be conclusively proven that a few Indonesian Muslims were involved, condemnation of those individuals and what they stand for would follow. But Western pressure on Indonesia for results just deepens the conspiracy theory and makes acceptance of Indonesian involvement all the more difficult.

The presence of so many foreign police and intelligence specialists helping with the investigation in Bali has been received thus far with more gratitude than suspicion, but the mood could easily shift. A war in Iraq in particular could ignite all the nationalist fears that in fact, the Bali bombing was only the precursor to serving a larger U.S. agenda. Before Bali, the backlash in Indonesia of a war in Iraq was probably manageable. Now, it could be much worse.