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Islam in Southeast Asia, Dr. Mahathir expressed an unpalatable critique that nevertheless resonated in the Middle East, the traditional heartland of Islamic teaching and political thought. Representing a successful and independent-minded Muslim country that sparkled in contrast with most economically and intellectually stagnant Arab states, he was heard with respect, garnering immense prestige for Malaysia. On the ground, he had name recognition. Abdul Rahman Aziz, an academic in Mecca for the hajj in 2005, was stopped at the Great Mosque's King Fahd Gate by a fellow pilgrim, a provincial court judge from Pakistan, who wanted to know if he was a Malaysian. When Abdul Rahman confirmed it, the judge gushed, "Please send my regards to Dr. Mahathir. Tell him he is a great Muslim leader and will go straight to jannah," heaven.[70] No other Muslim with pretensions to leadership had the courage and credibility to "tell it like it is". As Patricia Martinez remarked, "In his pragmatic understanding of — and agenda for — Islam and its umma, Mahathir was the best contemporary leader in the Muslim world."[71]

At the same time, Dr. Mahathir's international acclaim had an important domestic dimension. By focusing on Islamic trouble spots, he was able to contrast their problems with the success of his own government's Islamic policies. The implied warning, which he sometimes made explicit, was that if local Muslims did not unite and instead fell prey to different doctrines, they might end up like Muslims in Palestine, Afghanistan or Azerbaijan, subjugated by their enemies. Translated, that meant support the government and reject PAS. Above all, "Mahathir's acquired status of an Islamic statesman" contributed significantly to "the propagation of his version of 'modern' Islam at home".[72]

Still, the risks involved in Dr. Mahathir's Islamization programme in Malaysia were considerable. While he hoped to blunt PAS's appeal for the establishment of an Islamic state, which to all non-Muslims and a reasonable number of Muslims collided with the notion of a modern democracy, the conflict with PAS pushed Malaysia in a more conservative direction. In trying to match PAS, Dr. Mahathir made one concession after another, not just inflating and prolonging the Islamic resurgence but allowing it to move in dangerously illiberal directions, in ways that ultimately were completely at odds with the process of modernization and intellectual growth that Dr. Mahathir was seeking to promote.[73] In 1988, he amended the Constitution to raise the sharia courts to "co-equal" status with the civil law courts, which was to prove his "most fateful, yet ill-advised, innovation".[74] Henceforth, sharia court decisions, in their own area of jurisdiction, could not be appealed — and thus reversed — by any action in a civil court. The incessant UMNO-PAS contest raised expectations among some Muslims that the government would soon eradicate "all those values which were regarded as un-Islamic", leading to a more religious and puritanical order. Conservatives demanded the closure of nightclubs and discos, and attacked state-owned Radio Television Malaysia and UMNO-owned TV3 over their Western-oriented programmes and commercials.[75] The danger was that Dr. Mahathir would take one step too far and be unable to stop.

Dr. Mahathir's high-wire act was never more obvious than in 1992, when the PAS-dominated Kelantan government proposed the adoption of hudud, the Islamic criminal code that prescribes such punishments as amputation of the hand for theft, flogging for drinking alcohol and fornication, and stoning to death for adultery. UMNO voted for the hudud laws. Dr. Mahathir did not object to the concept of Islamic law, but attempted to brand the Kelantan legislation as a deviation from true Islam.[76] While subtly indicating that his government had no intention of introducing similar legislation, he said, "This does not mean that we reject the hudud. We only reject the interpretation and laws of Kelantan PAS, which are not compatible with the sharia."[77] Although legislated in the state in 1993, hudud could not be implemented without Parliament amending the Constitution.

So anxious was Dr. Mahathir to avoid handing PAS a political advantage that he chose not to round up a group of Indonesian Islamic extremists, who were on the run from the Suharto regime and proselytizing in Malaysia. Among them was Abu Bakar Ba'asyir, a preacher from Central Java, who emerged as the head of a regional terrorist organization, Jemaah Islamyiah, with links to Osama bin Laden's al-Qaeda. Committed to establishing an Islamic caliphate in Southeast Asia, Jemaah Islamyiah later carried out a series of bombings in Indonesia and the Philippines in which hundreds of people died. Abu Bakar Ba'asyir, who fled to Malaysia in 1985, remained in the country until after Suharto fell in 1998. According to Leslie Lopez, a Malaysian journalist whose reports did much to expose the shadowy network, Malaysian authorities monitored the group for years, but had no idea it was plotting violence. Dr. Mahathir vetoed police plans to detain the radicals because he had little time for Suharto and did not want to play into PAS's hands, Lopez said.[78]

As UMNO and PAS engaged in yet another round of what was dubbed holier-than-thou polemics, the distinction between them blurred: What were once considered extreme demands by PAS became government policy.[79] The battle also opened the way for a vast expansion and empowerment of the religious bureaucracies at state and federal level, all filled with graduates of conservative Middle Eastern institutions whose understanding of Islam was a good deal more reactionary and narrow than that of the prime minister.[80] State Islamic departments reached beyond supervising mosques and Islamic schools, collecting zakat, the wealth tax, and certifying those authorized to preach. They enforced Islamic law much more strictly with their own moral police, whose job it was to ensure Muslims observed regulations relating to fasting, decent attire and khalwat, close proximity between unrelated members of the opposite sex. The mufti, an official appointed by each state administration who usually sat as an ex officio member of the state Executive Council, emerged as a particularly powerful individual. As a jurist, he had the authority to issue a fatwa, a legal opinion

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