Indonesia's two largest Islamic organisations have backed a new anti-terrorism decree rushed through following the deadly Bali bombing, saying it gave security forces much needed power.

Tough laws came into effect on Saturday, allowing detention without trial and setting the death penalty for those convicted of terrorism.

Australia held a day of mourning for the Bali victims

Indonesia is the world's most populous Muslim nation, and support from the main Muslim groups is crucial for the government's stability.

The majority of Muslims in Indonesia are moderates, but small groups of radicals have come to prominence over their involvement in sectarian unrest, or for taking part in raids on nightclubs.

Solahuddin Wahid, deputy chairman of the 40-million member Nahdlatul Ulama (NU), said the new decree was a "good thing", while the Muhammadiyah, with 30 million members, said the decree would deter groups from using terror tactics.

"The Muhammadiyah can understand the need for such regulations, so that our security personnel, from the police or the intelligence, will have a legal umbrella to act against terrorism," said Muhammadiyah chairman Ahmad Syafii Maarif.

Bomb investigation

The Muslim leaders' backing came as police continued to guard the hospital room of radical cleric Abu Bakar Ba'asyir, who is being held over alleged terrorist activities.

Mr Ba'asyir denies links with terrorism

Mr Ba'asyir was rushed to hospital after collapsing on Friday, but doctors have said his health is improving.

Police want to question him in connection with bomb attacks on churches in 2000, and over alleged plots to kill President Megawati before she came to office.

He has not been accused of the 12 October nightclub bombing in Bali, which killed more than 180 people.

However, the cleric is suspected by some governments of leading the shadowy Jemaah Islamiah (JI) group, which they have linked to al-Qaeda. Mr Ba'asyir denies any links with JI or any involvement with terrorism.

Police have said the investigation into the Bali bomb is going well. They are investigating reports that three bombs may have exploded in the Bali attack, instead of two as reported until now.

Investigators said they were also checking unconfirmed reports that shortly before the explosions, a woman was seen running from the minibus which carried the explosives.

Meanwhile, Australian officials said on Monday that 92 Australians were feared dead, lowering its feared death toll from 103.

It came following a national day of mourning on Sunday in which flags flew at half-mast and church services and civic ceremonies were held around the country.

Prime Minister John Howard said before attending a church service in Canberra that the world had changed after Bali.

"I don't want to sound alarmist but we are living in a different world," he said.

"I can't give a guarantee it won't happen here."