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(Adds U.S. envoy's comments)
By Anis Ahmed
DHAKA, June 14 Bangladesh's self-styled "interim government", which took over with army backing 18 months ago vowing to rid the country of corruption and restore democracy, seems to be backing away from its promises, analysts say.
The release of former prime minister Sheikh Hasina on Wednesday on parole and a possible similar step for her rival Begum Khaleda Zia point to a major shift of policy, they said.
"We demand the government to explain the context of Hasina's parole, clarifying why she has been released," said Ferdous Ahmed Qureshi, chief of the Progressive Democratic Party.
"It appears that a section of the government is conspiring to take the country back to the pre-January 2007 period," he told a news conference.
Both Hasina and Khaleda had been detained since last year for alleged corruption.
The government's gestures have been welcomed by Hasina's Awami League party and Khaleda's Bangladesh Nationalist Party (BNP), the biggest political groups in the country.
The 15 years in which they alternated power were marked by political unrest, and Bangladesh also ranked high among countries for corruption, adding to woes from natural disasters like cyclones and flooding to which the South Asian nation is prone.
The incumbent interim government headed by former central bank governor Fakhruddin Ahmed has been strongly backed and influenced by the country's powerful armed forces.
Army chief General Moeen U. Ahmed has repeatedly said the military was not willing to take state power -- something it did more than once in the past -- but its indirect role in running the government is still evident.
Two of the government's 10 advisers (ministers) are former army officers, while the head of the Anti-Corruption Commission is a retired army chief.
In-service or ex-military officers hold many other key positions, including in the Election Commission, the telecommunications regulatory commission and others.
Bangladeshis generally saw the troops, already well thought of for their important rescue and relief work in natural disasters and their international peacekeeping roles, as doing the right thing in helping remove the country from the grip of politicians, whom many viewed as corrupt and incompetent.
Fakhruddin's government earned quick popularity after assuming power in January 2007 over its attempts to fight corruption and promises to end the country's traditional politics of feuding and violence.
In addition to the two former prime ministers, around 170 other key political figures, including dozens of former ministers were jailed. Nearly 50 have already been convicted and others are being prosecuted.
But the popularity of such moves was blunted as the government failed to contain rocketing food and commodity prices.
Though much of the rise was due to external factors and reflected worldwide trends, many of Bangladesh's people, most of whom are illiterate, blamed the crisis on the government.
And the country's politicians played up the issue in their effort to pressure the government to restore their freedom to operate and ease up on the anti-corruption drive.
With pressure building both at home and abroad, the government paroled Hasina on Wednesday for eight weeks, allowing her to travel to the United States for medical treatment.
Khaleda, also in detention and being prosecuted for corruption, is also expected to be paroled, officials said.
While Khaleda has refused to seek medical treatment overseas, she demands her sons, Tareque Rahman and Arafat Rahman, be sent abroad for better health care -- something the government tends to accept, officials and analysts said.
They said the challenges facing the government include convincing major political parties, especially Hasina's Awami League and Khaleda's BNP, to join in the election next December.
Sending the ex-premiers abroad or at least allowing them to move freely within the country would likely appease their parties and bring them to the polls.
Without their participation, analysts say, the election and related reforms would be mostly ineffective, and the interim authorities would be open to charges from rights groups and foreign countries of not restoring democracy.
Foreign attitudes are important to the impoverished and disaster-prone country of more than 140 million, which still relies on large amounts of direct and indirect foreign aid.
The U.S. Ambassador, James F. Moriarty, termed Hasina's release as a "good start" and said the political parties and government must work together to ensure a fair and credible election.
But he wanted the anti-corruption drive to proceed. "Certainly corruption is a huge problem in Bangladesh and the drive against corruption should be continued," the envoy added.
Hasina and Khaleda -- who alternated as prime minister for 15 years -- are the main contenders in the coming vote and one of their parties is likely to form the next government.
"Whatever good things or reforms they carry out will not be meaningful or legitimated without the participation of major parties," said Tanjib-ul Alam, a senior lawyer and political analyst.
"That is why they released Hasina and will likely do the same to Khaleda," he told Reuters.
Officials said the government was reviewing the Emergency Power Rules (EPR) to allow people held on corruption charges to be given bail, and that even those convicted could be allowed to appeal and contest the election.
Mujahidul Islam Selim, general secretary of the Communist party of Bangladesh, said: "the government appears to be trying to protect the corrupt and allowing corruption galore again."
(Additional reporting by Serajul Islam Quadir and Masud Karim)
* Says Indian investments have provided jobs to U.S. citizens
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