A mass rally last Monday in the Indonesian province of Aceh—where up to one million people demanded a referendum on secession—has exposed rifts within the new Indonesian regime over how to quell the separatist campaign.

Just weeks after the Indonesian national consultative assembly (MPR) ratified the UN-supervised secession ballot in East Timor, at the eastern end of the Indonesian archipelago, the government in Jakarta faces a renewed challenge in Aceh, which occupies the westernmost tip of Indonesia.

The record turnout for the rally followed statements by Indonesian President Abdurrahman Wahid, suggesting support for a referendum. Wahid's comments were then repudiated by Indonesian military and political powerbrokers, including former armed forces chief General Wiranto.

Wahid made his remarks during a five-day, eight-city tour of members of the Association of South East Asian Nations (ASEAN), his first overseas trip since assuming office last month. Indonesia's political elite reacted sharply when Wahid said that, if a referendum could be held in East Timor, one could be held in Aceh. Yet Wahid qualified his remarks by saying a vote was impractical and the mechanism would be different in Aceh.

He restated his position in the Cambodian capital, Phnom Penh on Monday, saying he was “pro-referendum” but refusing to commit himself. “We must wait and see how the referendum will be held,” he told reporters. In Manila, the last stop on his tour, he claimed to know the Acehnese people well enough to be sure they would not separate from Indonesia.

Nevertheless, his remarks emboldened participants in Monday's mass rally. Estimates of its size ranged from half a million to more than one million—out of a population of only 4.2 million. Youth and students had poured into Banda Aceh, the capital, for two days prior to the event, some travelling more than 12 hours. Banners, flags and chants proclaimed “Yes for Referendum” and condemned military atrocities.

Military commanders chose not to mobilise troops or riot police against the crowds. Instead, rally organisers appealed for calm and non-violence, a call that was largely heeded. Even so, most government offices closed for the day, shops were boarded up amid fears of looting, and schools were deserted as students joined the rally. About 400 protestors broke away and secured the release of 117 inmates from the town's two prisons.

In the wake of the demonstration, Indonesia's assembly speaker Akbar Tandjung, a veteran of the former ruling Golkar party, urged Wahid to cut short his foreign tour and travel to Aceh to hold talks with Acehnese leaders. Having completed the Asian leg of his tour, Wahid promptly flew back to Jakarta but two days later embarked on the second leg of his planned trip—to call on US President Bill Clinton in Washington and Japanese Prime Minister Keizo Obuchi in Tokyo. Wahid is also scheduled to receive eye treatment in the United States.

Wahid defended his decision not to go straight to Aceh by saying that he hoped to convince Clinton that Indonesia's decision to forge closer ties with Asian powers, such as China, India and Japan, would not come at the expense of its relations with the US and the West.

A cabinet delegation will now seek talks with Acehnese leaders, before Wahid and Vice President Megawati Sukarnoputri travel there later in the month.

After a crisis meeting of senior Indonesian cabinet ministers on Wednesday, General Wiranto, now in the key post of Coordinating Minister for Security and Political Affairs, dismissed talk of a referendum.

“The key for the Aceh solution is the commitment of all Indonesians, including the people of Aceh, to remain within the unity of the Republic of Indonesia,” he said. “Any solution to the Aceh problem must not go against the Constitution.”

Wiranto was making it plain that under the Constitution, Wahid has no power to hold a referendum without the approval of the MPR.

An armed forces (TNI) spokesman, Major General Sudrajat was even more pointed. “TNI finds the demand unrealistic,” he said in Bandung after addressing the Army Staff Command School. “A referendum will only be given to a society which does not yet have a government.”

Tandjung said the President would probably be invited to “give an explanation” to the MPR, as Wahid's predecessor B.J. Habibie was required to do after allowing a vote in Timor. “The spirit of all the DPR (parliament) members is that they don't want to give a referendum which leads to a separation from the territory of the Republic of Indonesia,” the official Antara news agency quoted Tandjung as saying. “It could become a precedent whereby similar demands will be made by other regions.”

A member of Wahid's cabinet, regional autonomy minister Ryaas Rasyid, underscored the high stakes involved in the Aceh conflict. He declared that a united Indonesia depended on how Wahid handled the problem. “It's the most serious situation we are now facing. If Indonesia should disintegrate, it would start in Aceh and Irian Jaya (West Papua).”

Indonesian government officials told reporters privately that Wahid's comments were mainly designed to placate disgruntled Acehnese and were unlikely to be backed up with concrete action. Wahid's aim appears to be to talk vaguely of a referendum, while offering autonomy with greater revenue sharing.

Legislation introduced earlier this year proposes that 30 percent of gas revenue and 15 percent of oil revenue would go to the regional governments. Wahid said in Manila on Tuesday he was prepared to offer Aceh 75 percent of its revenues, but that deal would have to be endorsed by the national assembly.

Wahid is also promising the prosecution of selected military personnel, a token gesture that Wiranto has embraced. A government-funded inquiry initiated by Habibie has reportedly determined that generals gave the orders for many of the atrocities committed by the military in Aceh over the past decade. The Investigation Commission handed Wahid a 484-page report on Wednesday, but no names were released. The inquiry's head, Amran Zamzami, said individuals had reported thousands of cases of violence, yet his investigation had focussed on several major cases.

These included abductions and killings in Pidie and shootings in Cot Murong, North Aceh, in May 1999 and the massacre of a local Muslim leader and 60 of his followers in two villages in Beutong Ateuh, West Aceh, in July 1999. These grisly murders, however, were only a small part of the repression inflicted upon the Acehnese masses.

Human rights groups report that 2,768 civilians have been killed in the past decade, with another 3,986 missing. One semi-official organisation, the National Commission on Human Rights, which launched an investigation in Aceh last year, said it had received reports that more than 39,000 people died in military operations.

While striving to appease both the military and the Acehnese masses, Wahid is trying to respond to Western and regional pressure to settle the Aceh conflict, which threatens large-scale oil and natural gas projects.

The International Monetary Fund (IMF) is sending a team to Jakarta next week for talks on the possible resumption of a $43 billion financial restructuring package, which was first triggered in 1997 by the Asian financial crisis. Last week, US Treasury Secretary Lawrence Summers said problems still remained to be dealt with before Western lending could resume, despite “some encouraging signs”.

In Singapore, former prime minister Lee Kuan Yew revealed the concerns felt in regional capitals. He warned that: “If they [the Acehnese] do get a referendum and have independence, then I think Indonesia is at risk and that's understood, I think, by everybody and so nobody wants that to happen.”

Billions of dollars in investments and potential profits are involved in the battle over Aceh. According to the Singapore-based Strategist Oil Report, Aceh, where Mobil has major interests, supplies about one-third of Indonesia's liquefied natural gas exports and 20 percent of total oil and gas exports. The small province also has gold and silver, rubber and timber. Neighbouring Riau, in north-central Sumatra, where Caltex is prominent, provides 60 percent of the oil and gas export total.

The exiled leaders of the Free Aceh Movement (GAM), based in Sweden, are seeking to use the popular hostility toward the Jakarta regime to form their own resource-rich breakaway state with the support of transnational oil companies and, possibly, Singapore. The Strategist Oil Report quoted GAM leader Hasan di Tiro as saying that the GAM wanted to make official contact with Singapore to discuss plans for a gas pipeline from Aceh to Singapore.

The GAM has never attacked foreign companies in Aceh, although it has accused Mobil of supporting the Indonesian army.

As Monday's mass rally proceeded, Hasan vehemently denied claims by Wahid that the two had agreed to talks in a telephone conversation last Saturday. On Wednesday Hasan dismissed talk of dialogue with Jakarta. “We don't need it,” he told Agence France-Presse, predicting that Indonesia would soon “become at least five different countries”.

In the wake of Monday's demonstration, some in the Acehnese elite are expressing nervousness about the popular mood in the province. “The rally was evidence that people are losing their patience,” said Tengku Muhamma Amin, a Muslim leader in the Aceh town of Sigli. “Who knows what they will do next?”

Separatist demands are also rising in resource-rich regions throughout eastern Indonesia. In Irian Jaya (West Papua) about 500 people demonstrated in the capital, Jayapura, on Monday, demanding independence. A larger rally is scheduled today.

In North and South Sulawesi, students have staged separatist demonstrations for the past month, with some former leaders speaking of reviving Permesta, a movement that erupted in 1957 demanding full autonomy for eastern Indonesia. Today the region features some of the largest coal, gold, oil and copper mining projects in the world.