The Indonesian government said it had prepared food, medicines and temporary accommodation for the 100, 000 refugees it expects to flee the fighting in the coming months.

ECONOMIST: War on the separatists

The Indonesian president flatly denies any involvement in a scandal at Bulog, the national food agency.

ECONOMIST: Will Wahid be next?

Transporting that food and medicine up into the hills will now prove even more challenging. (On Friday Indonesian troops stopped an aid convoy on the outskirts of Dili and seized two trucks laden with rice.) "The only thing we have a lot of is water from the river, " says John da Costa Freitas, a refugee.

CNN: ASIANOW - TIME Asia | East Timor: Step Forward, With Caution