Is Indonesia becoming the Balkans of the Far East?

Armed warriors have paraded through their villages carrying severed ears, arms and heads

JUST A few miles away from the place where I write this, a small coastal town in the Indonesian part of Borneo, human beings are doing unimaginable things to one another in the jungle. Thousands of ethnic Madurese have been burned out of their homes and scores murdered, and the burning and the killings are continuing. In the past three days armed warriors have paraded through their villages carrying severed ears, arms and heads. The motive is pure racial hatred. The police and army are impotent or indifferent. And the same kind of communal violence, for different reasons and by different means, is happening all over Indonesia.

Three weeks ago I was in the Spice Islands where Christians and Muslims are locked into their own murderous battle of religion, a tropical Northern Ireland in the making. Elsewhere in the archipelago, three of Indonesia's 27 provinces have declared their independence - one of them, East Timor, is almost certain to break away from the republic in the next year. In Jakarta, demonstrations against the government are gathering momentum in the approach to June's elections - during the last big demo, in November, 13 people were shot dead.

To Europeans, all this should have a disturbingly familiar ring - a large state, ethnically and religiously diverse, which throws off a corrupt dictatorship, only to find itself stricken by communal violence. Is the world's fourth largest country breaking up? Will Indonesia become an Equatorial Yugoslavia?

It is an urgent question because the consequences of instability here would be serious. Indonesia's 13,000 islands occupy the crossroads of Asia, an area of profound strategic, political and environmental importance to the rest of the world. A substantial part of the world's oil passes through the country's territorial waters - prolonged disruption to shipping in the Straits of Malacca, for instance, would seriously affect the economies of both Japan and China. And Indonesia's sprawling expanse makes it a neighbour to the whole region. The prospect of an exodus of refugees from a population of 210 million causes alarm from Canberra to Bangkok.

This is why foreign governments gave such enthusiastic and unquestioning support to President Suharto, the man who bears the greatest responsibility for Indonesia's present turmoil. For 32 years, he ruled a country which, from the outside, appeared to be a model of Third World development. GDP soared, population growth was slowed, poverty was reduced and illiteracy was virtually eliminated. His predecessor, Sukarno, had been an unpredictable demagogue who flirted with communism and fought a low-intensity war with Malaysia. No wonder the countries of the west, Britain among them, were so willing to supply him with arms and to turn a blind eye to the brutal annexation of East Timor.

Everyone knew that Suharto's rule was based upon fear; the more astute could see that the benefits of Indonesia's success were disproproportionately concentrated in Suharto's home, the main island of Java. At the time, however, he seemed to have succeeded in bringing about permanent stability. Only in the last two years it has become obvious what an illusion that was.

As a nation state, Indonesia was always an unlikely proposition - the only thing that its diverse people had in common was their colonial history as the former Dutch East Indies. Rather than eliminating ethnic and religious difference, Suharto froze them, forcing unity and stifling dissent with a repressive military apparatus. Last May the thaw set in, and in the last 10 months the old enmities have emerged pristinely from the ice.

This is the best way of understanding the grisly diversity of violence presently on display in Indonesia. The hanging of traditional sorcerers in East Java, and the beheading of Madurese settlers in Borneo have nothing in common in terms of direct motivation. But both are symptoms of the same sickness - a combination of economic distress and the break down of law and order, among populations which have no other means of expressing a deep sense of injustice and pent-up frustration.

But there are huge differences as well as similarities, and for several reasons the Balkans experience is unlikely to repeat itself here. The most basic of these is Indonesia's size, a source of passive strength as well as vulnerability. In Yugoslavia, two religions and a handful of ethnic groups battle for a geographically and historically uniform region - they are fighting for what they have in common. But Indonesians are as diverse as any people in the world. To an ethnically Chinese Christian yuppy in Jakarta, the independence struggles of animist tribesmen in Irian Jaya are almost as alien as they are to the inhabitants of London or New York. However concentrated power may be in Java, no single ethnic or religious group is powerful enough to threaten the whole. For all their frustration with their central government, Indonesia's provinces have much to lose from breaking away. East Timor is misleading in this respect for in every way it is an exception. As a former Portuguese colony, it was never part of the Dutch empire and played no part in the Indonesian war of independence. Despite its passive capitulation, the UN never recognised Jakarta's annexation. Indonesia's announcement that it is prepared to give it independence came as a result of international pressure, and a brilliantly effective campaign by NGOs and East Timorese exiles.

East Timor's struggle has been one of principle, but in the rest of the archipelago dissatisfaction has its roots in practical matters. In Borneo, Aceh and Irian Jaya, big corporations have made fortunes in timber, oil and copper with negligible benefit to the population at large. Resentment for this exploitation has laid the ground for independence movements and outbreaks of violence. But what people want is not sovereignty so much as justice.

All now depends on the outcome of general elections to be held in June - the closest Indonesia has come to real democracy since 1955. A decisive victory for a popular and visionary president could halt the paralysis which the country is experiencing under Suharto's unpopular successor and appointee, BJ Habibie. But with 48 parties competing and no clear favourite among a handful of frontrunners, such a clean result is unlikely. Instead of sudden anarchy or civil war, Indonesia faces decades of uncertainty, a directionless drift back into the Third World.