Day Three of riots in Indonesia. Student protesters blame President Suharto for the current economic crisis and are demanding his resignation. Ian WIlliams of Independent Television News brings a report from Jakarta. After this background report, two regional experts discuss the situation.

JIM LEHRER: President Suharto cut short a visit to Egypt today and is now back in Indonesia. Now, some background to today's events. Spencer Michels reports.

SPENCER MICHELS: For more than 30 years, Indonesia, the world's fourth most populous country with a population of 200 million people, has been governed by the authoritarian regime of President Suharto, who, like many Indonesians, uses only one name. The 76 year old former general came to power in 1965 with U.S. support in a bloody, anti-Communist purge that killed an estimated 500,000 people. In the three decades since Suharto's coup, Indonesia was transformed from a poor and backward nation to an emerging economic power. Its annual per capita income soared from $50 to $1,000. Then last summer, when economic trouble hit other Asian nations, Indonesia's bubble burst. Its currency, the rupiah, plummeted, now down 70 percent of its value since last July, putting the price of goods out of reach of many Indonesians. The stock market also plunged more than 70 percent. The International Monetary Fund offered and Suharto reluctantly accepted after several rounds of negotiations a $43 billion bailout package. Indonesia's leaders agreed to cut budgets, cut subsidies, and to end cozy relationships between the government and businesses, including companies owned by Suharto family members. But cutting subsidies caused food, fuel, and transport costs to soar, provoking even more anger among poor Indonesians.

On the political front Suharto has kept tight rein on opposition political parties and individual liberties. The small government sanction opposition party called the PDI has called for Democratic reform. A major opposition figure, 49 year old Megawati Sukarno Putri, daughter of the late President Sukarno, accuses the government of engineering her ouster from her party's leadership. Last week on Capitol Hill members of the House Subcommittee on Human Rights heard testimony of abuses by Suharto's government from a group of Indonesian dissidents.

PIUS LUSTRILANANG, Indonesian Dissident: I was kidnaped on 14th of February while waiting for public transport in front of the general hospital in Jakarta. Suddenly, somebody with a pistol told me to get into car, and after approximately a one-hour drive, we arrived at the place where I was held for two months. The first three days were the worst. They gave me electric shock, kicked and hit me all over my body.

SPENCER MICHELS: Last week, Indonesia's armed forces chief announced that political reform was on the national agenda. He called for students to stop their protests. But protesters received support from Indonesia's top Muslim leader and a group of former generals and cabinet members all calling for President Suharto's resignation. The State Department today ordered all non-essential embassy employees to leave Indonesia and warned U.S. citizens, both business people and tourists, not to travel there.