COURIER-MAIL: City on the Edge [Jakarta teeters towards a military coup]

While Indonesia's new President tours the globe trying to shore up his country's finances, tension mounts at home, writes Michael Ware in Jakarta.

THE question is on everybody's lips in Jakarta this weekend: will there be a military coup?

Political turmoil has engulfed Indonesia's fledgling democracy and the strain is apparent.

People's lives go on, the streets remain choked with traffic and business continues, but the tension is palpable.

The republic's new President, Abdurrahman Wahid, the enormously popular, near-blind and ailing Muslim cleric, is overseas trying to lobby world leaders and financiers on his country's behalf to support his troubled economy while, at the same time, assuring foreign leaders he is still in control.

But his absence now, of all times, has played into the hands of those who, some fear, might seek to destabilise his new Government.

Prompted by the findings by an Indonesian human rights commission of widespread military involvement in the destruction of East Timor as it opted for independence in an August 30 ballot sponsored by the UN, Wahid has been forced to accelerate moves to dismantle the military's privileged position of power in society.

The military power bloc had been led, until recently, by General Wiranto.

Appointed armed forces chief by then-president Suharto, who assisted his early rise to prominence, and kept in the position by interim president B.J. Habibie, who made him defence minister, Wiranto was stood down as commander last year by Gus Dur, as Wahid is affectionately known.

The Defence Ministry portfolio was taken from him and the lesser post of Co-Ordinating Minister for Political and Security Affairs was given in its place.

Since then the balance within the military has shifted with seismic-like impact.

The navy, a more moderate arm of the services, has been elevated to a new dominance, with Wiranto's successor an admiral.

Wahid's revamping of the military has been adept, but politically risky.

The reason for Indonesia's teetering on the brink is the clash of these forces: the old and the new.

WIRANTO was named with 32 others, according to his lawyers "unfairly" and "in denial of natural justice", as being indirectly responsible for the horrors of East Timor.

Now his President has ordered him to resign from his remaining Cabinet spot and surrender his Co-ordinating Ministry.

And, a worse indignity, it is said the president has signed-off on his removal as a general.

The people have never seen anything like it. For three days Wiranto has refused to go.

How Wahid resolves this stand-off will, in many respects, define the nature of his democracy.

And every Indonesian, from the educated elite to the soldiers in the ranks and the vendors on the chaotic streets, knows it.

Most don't want to discuss it, not with a newly arrived foreigner. But everywhere you go people are keenly watching their television sets for news.

Each new press conference, like yesterday's with Defence Minister Juwono Sudarsono, and every little development, is avidly discussed.

However, almost everyone you speak to wishes Gus Dur was back at home.

"Oh yes, it would be better for him here, I know it would make me happy," is typical of the reply.

Instead he is walking the halls of power in Europe on a 13-nation tour.

BUT running an administration as diverse and problematic as his -- the first to be freely elected in 44 years -- by remote control is proving a difficult task.

His vice-president, Megawati Sukarnoputri, is in charge until his return. But, it is reported, she failed to confront the defiant general when he appeared at Wednesday's Cabinet meeting, less than a day after being ordered to resign.

The people now wonder what this means for her, with the topic of Wiranto's dilemma not even discussed by Cabinet.

Instead, images of Gus Dur ambling out along a red carpet or of a nighttime meeting with Dutch leaders, have been playing continually on Indonesian television and satellite news channels all day.

The shots are fleeting but are designed, perhaps, to be reassuring.

Meanwhile, local news and current events programmes have screened interviews with generals, officials and politicians dispelling the rumours of an overthrow by disenchanted elements of the Indonesian armed forces, presumably those loyal to Wiranto or the five other accused generals.

The people certainly want to believe, but no one is sure. And for every word of assurance is another of discontent.

On the other side of the globe, Wahid has revealed claims that a group of generals held a "covert meeting" somewhere in Jakarta's Chinatown, implying their agenda was to plot a coup.

He added that a massive demonstration of Muslim militants was being plotted by those with "dirty hands".

The new armed forces chief, Admiral Widodo, and the National Police Chief, General Roesdihardojo, had been given full authority to deal with the situation, he said.

The flames of speculation were fanned on every street corner and in every restaurant conversation.

The change in tone was evident.

Mention the issue and people, who moments before spoke well-practised English, suddenly look at you devoid of all expression.

"I'm sorry," they mutter. "I do not understand."

In the morning press most analysts and commentators are stressing just how unlikely a coup really is.

But the rumours have been enough to dampen the stock market and hurt the value of the rupiah.

The smart money, though, is banking on Wiranto's stand being merely a time-soaking ploy to produce a better deal for his departure.

The people of Indonesia, meanwhile, simply wait.

They've seen it all before, and sometimes worse, especially when the armed forces were truly at their peak, yet their faith in Wahid is strong.

"Ya, Wahid," they say with a smile when they pick his name out of your conversation.

Ask for anything more, and a smile and a nod is all that comes back.

However, most seem comfortable with the events, believing, in their hearts, that all will be well.

They're banking on the fact the reformists, most importantly in the military, appear to be gaining the upper hand.

Or so the people hope.