Sydney: The Indonesian Embassy was closed yesterday and its 22 staff ordered to stay in isolation for 48 hours after the discovery of a suspicious package containing a biological agent.

The incident was linked immediately to mounting public anger over a 20-year prison sentence imposed by a court in Bali on an Australian holidaymaker convicted of drugsmuggling.

It prompted another intervention in the case by John Howard, the Prime Minister, who condemned the embassy action and apologised to Indonesia on behalf of the Australian people, describing it as an “act of reckless indifference to human life”.

Analysis revealed that white powder found in the package was harmful, but further tests are required to identify it.

Mr Howard said that there was little doubt that the incident was linked to the case of Schapelle Corby from Queensland, who was found guilty last week of trying to smuggle 4kg (8.8lb) of cannabis through Denpasar airport. She had said that the drug had been planted in her luggage in transit as she flew from Brisbane to Bali via Sydney, a claim reinforced by subsequent revelations that drug-trafficking was rife in Australian airports.

Australian reaction to the 27-year-old beautician’s treatment by the Indonesian legal system has verged on the hysterical with many people calling on tourists to boycott Bali and airlines that fly there. Callers to radio stations have demanded that politicians take a tough stand against Indonesia. Buildings and bridges have been festooned with “free Schapelle” signs, many urging motorists to sound their horns in support.

Fearing an anti-Indonesia backlash, the Government said that such protests would not help Corby’s cause. Alexander Downer, the Foreign Minister, said threatening behaviour towards Indonesia would damage efforts to secure an exchange agreement for prisoners.

In Indonesia Marty Natalegawa, a Foreign Ministry spokesman, told Metro TV station: “We want to stress that we will not be intimidated by this act. If this act turns out to be related to Corby, we hope that the Australian people do not make the Indonesian people their enemy.”

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