The struggle between Indonesia's entrenched elites - including the military - and its newer progressive forces was enacted on the streets of Jakarta in the weeks following the 7 June election.

The violent protests appeared to end in a setback for the military, with the government announcing it would delay the implementation of a law giving the army draconian new powers to curb popular protests.

But this setback is only one element in a wider struggle, which has been going on since the fall of President Suharto, and whose outcome is still highly uncertain.

Riot police block the path to the Indonesian parliament

The populist forces unleashed during the riots which preceded the overthrow of Suharto in May 1998, born out of poverty and bitter frustration with rampant institutional corruption, are still bubbling under the surface of Indonesian society.

The more recent violent protests and the government's hasty volte face, are a reminder that the government ignores these forces at its peril.

They are also a sign that the democratic elections held in June have not yet ushered in a new dawn for Indonesia.

The country is in a dangerous, and unpredictable, period of transition. The People's Consultative Assembly - the body which was elected in June - still has to formally decide who is to be the country's next president.

President Habibie, Suharto's successor, is the incumbent Golkar party's official candidate. But by deciding to allow the referendum on East Timor's future to go ahead, a move which culminated in the army's humiliating withdrawal from the territory, he effectively wrote his own political obituary.

After the June elections, in which Golkar was beaten into second place, Habibie was already looking like a lame duck.

The military are Golkar's natural allies, and may yet have thrown their weight behind him. But after Timor, Habibie shattered any hope he might have had of retaining their support.

How the military decides to exert its influence is a vital question for Indonesia. Under Suharto, their pre-eminence was guaranteed constitutionally. Even in today's "democratic" Indonesia, 38 seats in the People's Consultative Assembly are reserved for the military.

And their power extends far wider than a few seats in parliament might suggest.

Fears of military coup

General Wiranto, the army's chief of staff, is widely regarded as one of the most powerful men in Indonesia today.

Cars were set ablaze during the street battles

That he has presidential ambitions is undeniable, despite the fact that he has been a little coy in announcing them up until now.

However, although there are suggestions from some quarters that what we are seeing is a creeping military coup in Jakarta, it is more likely that the army will choose to exercise power using familiar constitutional means: its key bargaining role in the People's Consultative Assembly, and the backstage influence it exerts on Golkar and other political parties.

The iron fist inside this "velvet glove" of backroom politicking is the ever-present threat of the Balkan-style breakup of Indonesia, which the army will do everything in its power - constitutional or otherwise - to avoid.

Opposition holds fire

Beyond this, it is not even clear that the army itself has decided what its political role should be.

As for the opposition groups in parliament - the PDI-Struggle party of Megawati Sukarnoputri, which won the biggest share of votes in June, and the Islamic grouping led by Abdurrahman Wahid - they have been notably quiet since the elections.

No doubt they too have their share of backroom deals to cut. They have yet to field an official presidential candidate; and it may yet be that the role of vice president is offered to General Wiranto as a sop to the army.

Megawati herself has a clear populist touch, but her democratic credentials are still to be proven.

Megawati: Her democratic credentials are unproven

She is certainly not averse to drawing on nationalistic sentiments: she was highly critical of Mr Habibie's decision to let Timor go, and has been vocal in her support of pro-Jakarta refugees in West Timor. In this, she is in step with army sympathies.

The army, and the government, have clearly been jolted by the strength of feeling on the streets of Jakarta.They say that the bill on army powers will be shelved while a period of public consultation takes place.

As such, it is just a temporary setback, they say. But however shaky Indonesia's transition to democracy, the riots are a sharp reminder that things have changed since Suharto.

And whatever the behind the scenes maneouvrings amongst Indonesia's political elites, they cannot afford to forget that, for good or ill, the masses on Jakarta's streets now wield a certain power of their own.