Obserrvations on Bali
Smoke from the coconut-fired barbecues along Jimbaran Beach on Bali mixes with the sweet fumes of kretek, the Indonesian clove-laced cigarette, on a balmy tropical night.
Although this is just metres from where a bomb killed 20 tourists and local people on 1 October 2005, three years after the first Bali bombs killed 202 people in Kuta - a short distance away on the southern tip of the island - the atmosphere is relaxed as a band switches effortlessly between Japanese, Korean and Indonesian pop songs.
But there are hardly any requests for western tunes because there are not so many bule (whiteys) around as there were before the bombings, and their number has been only partly replaced by Japanese and the new affluent of the Far East - the Koreans and Chinese.
Ten of the bombers had their sentences reduced to mark the country's independence day on 17 August, and President Susilo Bambang Yudhoyono claimed that the war on terror in Indonesia had been won. In June special forces captured Zarkasih, the acting leader of Jemaah Islamiyah (JI), the south-east Asian al-Qaeda affiliate held responsible for the Bali bombings as well as other attacks, and the commander of its military wing, Abu Dujana. But security at Bali's five-star hotels remains as heavy as at similar hotels in Jakarta.
As Professor Michael Hitchcock and I Nyoman Darma Putra explain in their new book, Tourism, Development and Terrorism in Bali, western tourism to the island was just recovering from 2002 when the 2005 bombs reversed that advance, and visitor numbers have not returned to the pre-2002 level.
Some western tourists - such as the US naval personnel who used to patronise Cuban cigar stores in Kuta - are unlikely to return.
Even though the authorities hailed the arrests of Zarkasih and Abu Dujana as proof of their success against JI, intelligence observers warn that support for the terrorist group is growing, bolstered by the use of Islam by some constitutional politicians as a means to gain power, and by increased poverty. A proposed EU prohibition on Indonesian prawns could lead to 200,000 jobs being lost. "Do they want to add them to the number of desperate men who see terrorism as a solution?" says Iwan Sutanto, president of the Prawn Farmers' Association.
Hitchcock and Putra argue that Bali offered, and still offers, an excellent soft target for JI militants to hit the US, its local "sheriff" Australia (hated particularly for its role in forcing Indonesia to leave East Timor in 1999) and what JI views as the "slags" in nightclubs. Bali attracted so many western tourists because it was branded as an Asian Pacific island paradise without any obvious reference to Indonesia. Inside the country, Bali's Hindu majority fulfils the role of living guardian of the Java-based medieval Hindu empire of Majapahit, the great inspiration for the secularist nationalist founding fathers of modern Indonesia.
Increasingly the Balinese themselves are not only keen to protect their own heritage and lucrative tourism industry, but also committed to maintaining the country as a multi-faith nation in the face of rising political Islam.
With a recent Hizb ut-Tahrir rally in Jakarta attracting 100,000 people, however, the battle for Indonesia's soul is raging as fiercely as when independence was proclaimed in 1945.
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