BANDA ACEH, May 8, 2005 (IslamOnline.net & News Agencies) – In the first mega-project to rebuild the tsunami-devastated Aceh province, Indonesia and the US signed on Sunday, May 8, a 245-million agreement to build a main highway linking the provincial capital Banda Aceh to the west coast.

“What we are starting today may give hope to bring life back and continuity to the people of Aceh,” US Deputy Secretary of State Robert Zoellick said after inking the agreement, reported Agence France Presse (AFP).

The 240-km (150 mile) highway project will connect Aceh's provincial capital with the city of Meulaboh, which was almost wiped out by the killer tsunami, triggered by a 9.0-degree undersea quake.

Almost 160,000 people are feared dead and a half-million are homeless in Indonesia as a result of the disaster, which Jakarta estimates caused 43.7 trillion rupiah ($4.7 billion) in economic losses.

“They try to create a new Aceh and that gives me a sense of hope,” said Zoellick, adding that the primary objective of the road is to make a significant contribution to improving employment and the local economy.

He stressed that the construction of the highway will feature 113 bridges and culvert crossings.

Aid officials said tenders for the road project have already gone out and construction is ready to begin soon after the US Congress appropriates the money, which is expected as soon as this month.

The international community has pledged an estimated $9 billion for tsunami relief and the reconstruction of the affected Indian Ocean nations, the bulk of that destined for Aceh.

In another development, the Indonesian government decided Sunday to lift this month an emergency law imposed on Aceh last year.

“It will not be extended,” Kuntoro Mangkusubroto, the head of the province's reconstruction agency, told Reuters, in the first disclosure of the government's intention to lift the emergency status.

Kuntoro, a Stanford University-trained engineer and a former mines and energy minister, however, gave no further details.

Aceh's emergency law was introduced by the government a year ago and extended for six months last November reportedly to suppress separatist groups in the province.

Under the law, the civilian authority was given special powers to enforce security measures such as curfews and house searches.

An Indonesian soldier and three from the separatist Free Aceh Movement (GAM) were killed during a clash on Friday, May 6, in a village in northern Aceh, the military said on Sunday.

Aceh has been a battleground for government and armed separatists since 1976 when GAM launched a campaign for independence, angered by Jakarta's exploitation of the province's resources.

Following the tsunami disaster, both the government and GAM called for a formal ceasefire in order to facilitate the massive relief effort.

The two sides made headway during their negotiations, hosted by Helsinki in April, with a government official signaling readiness to meet some self-government demands.