Jakarta, Indonesia ? In a bid to prevent the world’s most populous Muslim country from becoming a thriving haven for extremists, U.S. Secretary of State Colin Powell announced Friday that the United States would begin restoring military ties and provide more than $50 million to improve Indonesia’s ability to wage war on terrorism.

The two measures will open a new chapter in U.S.-Indonesian relations after a decade of restricted contact and aid. They are also a major boon to a country vulnerable to Islamic militancy in a region, Southeast Asia, known as the second front in the war on terrorism.

“Indonesia has got a threat, the United States has a threat, and we all need to work jointly against these kinds of organizations and these sorts of individuals,” Powell said at a news conference here during an eight-nation Asia swing.

Indonesia gained new importance after Sept. 11, since extremist groups based here were found to have ties with al-Qaida. Some cells plotting against U.S. targets in Singapore, Malaysia and elsewhere in the region have been uncovered during the last eight months. And several fugitives linked to al-Qaida or local extremist cells are now hiding in Indonesia, according to U.S. and Asian officials.

But Indonesia has been the most lax nation in the region in moving against Islamic militants. Just a day before Powell’s arrival, the head of a leading Indonesian militant group was put on trial on charges of inciting hatred only to have the judge postpone the trial because the defendant looked ashen. Jafar Umar Thalib, a radical cleric who heads the paramilitary group Laskar Jihad, was released pending the resumption of prosecution.

The Bush administration also has opted to begin normalizing military contacts despite the fact that the government of President Megawati Sukarnoputri has not yet complied with a U.S. congressional mandate to account for past military abuses.

Washington scaled back military ties in 1992 because of Jakarta’s repressive tactics in East Timor, a territory it had annexed. All connections were severed in 1999 after Indonesian militias backed by the army allegedly engaged in atrocities when East Timor voted for independence. Indonesia, which has been undergoing a turbulent transition to democracy since 1998, has not charged or put on trial most of the military officials associated with that period.

Nevertheless, the United States will provide more than $50 million over the next two years to beef up Indonesia’s counterterrorism forces and capability, Powell said.

The United States is getting around congressional restrictions on providing aid to the army by channeling most of the funds to Indonesia’s fledgling police force, which was recently carved out of the military.

About $47 million will go to training the police, with $16 million of that devoted to the creation of a special counter-terrorism unit. Other funds will be used to help secure the borders of this nation.

But Washington has also allocated $4 million to Indonesia’s military for “fellowships” in counter-terrorism, with an additional $400,000 for military training.