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2 of 27 DOCUMENTS Copyright 2003 The New York Times Company The New York Times July 5, 2003, Saturday, Late Edition - Final

SECTION: Section A; Page 3; Column 1; Foreign Desk LENGTH: 1256 words HEADLINE: Saudis Quietly Promote Strict Islam in Indonesia BYLINE: By JANE PERLEZ DATELINE: JAKARTA, Indonesia, July 4 BODY: In high school, Atep Arofiq was fascinated by Islamic studies, and with meager means for higher education, a free institution financed by Saudi Arabia in this bustling capital seemed like a natural choice. There was an added attraction: the best students could graduate to further study in Saudi Arabia, all expenses paid. Mr. Arofiq, 25, entered the Educational Institution of Indonesia-Saudi Arabia, housed in a gleaming building on a main thoroughfare. He lasted in the austere environment for two years. "There were too many forbidden things," he said of the school where the Arabic language, taught by teachers from Saudi Arabia, is the focus of the curriculum. "You were not allowed to join any other student organization. Jeans were out, and they preferred that you wear a beard and long Arabic clothes." Mr. Arofiq did not feel at home at the Saudi-run school, where he said the strict Wahhabi form of Islam was the basis of the teaching. But he was the exception. Most students persevered for the full five years, he said. From the financing of educational institutions to giving money for militant Islamic groups, the influence of Saudi Arabia, and Saudi charities, has been growing steadily here in the world's most populous Muslim country. Until recently, Indonesia has been famously relaxed about its religion. But slowly Indonesians are becoming more devout and in the battle for the soul of Islam here the Saudis are playing an important though stealthy role, Indonesian scholars say. The Saudi money has come in two forms, Indonesian and Western officials said: above-board funds for religious and educational purposes, and quietly disbursed funds for militant Islamic groups. The Saudi money has had a profound effect on extremist groups, allowing some to keep going and inspiring others to start recruiting, the officials said. A Saudi charity, Al Haramain, provides a good example of this dual role. Three years ago it signed a formal memorandum of understanding with the Indonesian Ministry of Religion that allowed it to finance educational institutions. But Al Haramain also appears to have served as a conduit for money to Jemaah Islamiyah, a Southeast Asian terrorist organization that aims to build Islamic states in the region. A senior member of Jemaah Islamiyah, Umar Faruq, who was arrested last year and is now in American custody, told the Central Intelligence Agency that Al Haramain provided money to his group. Earlier this year, under pressure from Washington, Saudi government officials announced that Al Haramain had been asked to close down in all the Muslim countries where it was operating.