Mr Suharto is claiming $27bn (189 trillion rupiah) from the magazine for an article published on 24 May, which says he amassed a fortune of $15bn during his rule of Indonesia.

BBC Jakarta Correspondent Jonathan Head: "Much depends on the performance of the Indonesian courts"

He says the accusations against him are "unlawful and defamatory, insulting and baseless, not only against me but the Indonesian nation".

Mr Suharto says he will donate any money he wins to the Indonesian people, "especially to help the poor ones".

Recent estimates of the market capitalisation of Time Warner, the company that owns Time Magazine, put its worth at around $87.75.bn.

Lawyers for Time have not made any comment on the suit.

'No evidence'

Mr Suharto said he had given Time the opportunity to show evidence to back up its accusations, but the magazine had not produced any.

Many Indonesians blame Suharto for the country's economic woes

Asked why Mr Suharto was seeking such a large amount in damages, the former president's lawyer said: "It is because our client is trying to help Indonesian citizens to battle poverty.

"Our first demand is for Time to publish an apology for the article, since it has defamed our client's good name. Our second demand is to compensate for material and immaterial damages."

The May report alleged that Mr Suharto moved $9bn from Swiss bank accounts to accounts in Austria last year.

The Swiss and Austrian authorities say they have no evidence of such a transfer and a visit there by two senior Indonesian ministers also failed to produce any new evidence.

The wealth allegedly accumulated by the Suharto family during Mr Suharto's 30 years in power is the subject of an on-going investigation by the Indonesian Government, although it has made little progress to date.

Political pressure

PDI-P 35.8% Golkar 19.1% PKB 17.1% PPP 10.0% PAN 6.8% PBB 2.0%

Whoever forms the next government will have to deal with considerable popular pressure to widen the scope of the inquiry.

Although final results following last month's election have still not been announced, the latest official result puts the opposition PDI-P well in the lead with 35.8% of the count.

The ruling Golkar party, closely associated with the former Suharto regime, trails the PDI-P in second place.

Mr Suharto was forced to step down from power in May 1998 amid widespread rioting.