Hardline Indonesian cleric Abu Bakar Bashir walked out of a Jakarta jail today after serving time for links to the 2002 Bali bombings.

Wearing his trademark white skullcap and shawl, a smiling Bashir was surrounded by supporters shouting "Allahu Akbar" (God is greatest).

"I thank God almighty, also my lawyers and the gentlemen who defended me during my trials," Bashir said.

"I will maintain my struggle to uphold sharia (Islamic law), he added, before getting into a black van.

Seen by the West as the spiritual head of the al Qaeda-linked Jemaah Islamiah (JI) regional militant network, Bashir was convicted of being part of a conspiracy behind the Bali bombings that killed 202 people, many of them Australian tourists.

Southeast Asian and Western authorities blame the group for the Indonesian resort island attack and other strikes in the region.

Hundreds of Bashir supporters from hardline Muslim groups were outside the jail to welcome him. Scores of police were also on hand and security was tight, but the crowd quickly dissipated once the cleric had left.

Some planned to join a motorcade expected to take Bashir back to his school.

Punching his fist in the air with joy, Bashir's son Rohim told reporters: "I'm very happy right now. All things have been resolved, and he is free now".

Asked about possible police surveillance of his father, he said: "I don't care about it. If they want to watch, go ahead".

There had been little international comment on Bashir's scheduled release. But Australian and US officials have in the past criticised Indonesia, the world's most populous Muslim nation, for giving him a relatively light sentence and for subsequently reducing the term.

Analysts say militants could use Bashir's release to revive Jemaah Islamiah, which police say has become decentralised, with factions splitting off and operating independently.

"The perception among security forces is that the release may help consolidation moves as they (JI) have been torn after the death of their leader," said University of Indonesia security analyst Andi Widjajanto.

Terrorism mastermind

He was referring to alleged terrorism mastermind Azahari bin Husin who was killed in a police raid late last year.

Bashir was arrested several days after the 2002 Bali blasts for investigations on separate crimes and later spent 18 months in jail for minor immigration offences after treason charges against him were dismissed or overturned in court.

Police rearrested him for suspected links with the Bali attacks as he was leaving prison in April 2004. A court last year sentenced him to 30 months in jail after finding him guilty of being part of a conspiracy behind the bombings.

The 67-year-old cleric, who has called al Qaeda leader Osama bin Laden a true Islamic warrior, denied any wrongdoing. He insists Jemaah Islamiah does not exist, and Indonesian courts have dismissed charges that he led the network.

His walk to freedom comes after a reduction in his sentence from remissions he received on Indonesia's 60th independence celebration last August and because of time served in detention.

Bashir plans to take a 12-hour overland ride to the Al-Mukmin Islamic school he co-founded near the city of Solo, around 480 km (300 miles) from Jakarta, where a low-key homecoming awaits him.

"We have been told by him that we don't need to be festive. If we celebrate, it will poke some sick-hearted people and they could become sicker," principal Farid Ma'ruf told Reuters by telephone from the Central Java school.

Several graduates of the school, popularly known as "Ngruki" after the neighbourhood where it is located, are in prison for involvement in terrorism. The Brussels-based International Crisis Group has branded the school the "Ivy League" of militants.

Indonesian authorities, however, have reviewed its curriculum and say they found no inclination towards terrorism.

Indonesian officials say that despite the capture of nearly 300 people suspected of violating anti-terrorism laws, violent militants remain a serious threat in the vast archipelago of 17,000 islands and 220 million people.