Bloody frustration.

Algerians are increasingly weary of the relentless struggle between underground Islamic militants and the armed forces. Mass demonstrations last March against the mounting tide of terrorism expressed the widespread mood of frustration, both at the activities of the fundamentalists and the obsessive repression of the regime.

HUGE PROTEST MARCHES against terrorism on 22 March in Algiers and other large cities were sanctioned by the government, but appear to have been motivated by genuine popular outrage. The organisers, which included the Union generale des travailleurs algeriens (UGTA), claimed 1.5m Algerians turned out around the country. The demonstrations seem to have been the catalyst to pressure the government into a tougher line against fundamentalist extremists.

The government was prompted to break off diplomatic relations with Iran, which is accused of helping Algeria's Islamic militants, and has recalled its ambassador from Sudan, another fundamentalist regime alleged to have provided support to the clandestine opposition. The US State Department has recently accused Sudan of being behind the growing pan-Islamic movement in the Arab world.

Terrorism entered a new phase with the gunning down in mid-March on the streets of Algiers of three men close to power. Two belonged to the National Consultative Council, a purely advisory body of 60 men appointed by Boudiaf. Laadi Flici was an eminent doctor, writer and poet who was shot at pointblank range in his surgery in the Kasbah where he used to give free treatment to the poor. Haif Senhadri, undersecretary at the Ministry of Vocational Training, took four days to die after being shot through the bars of the lift as he was taking his daughter to school. The third victim, Djillali Liabess, was the highly respected director of a government-sponsored research institute charged with looking into Algeria's long-term economic and social problems and a former education minister.

The murders caused outrage. "Good men who were only trying to help the country," said a grief-stricken mourner at one of the heavily attended funerals. "They were not political. Why were they killed?". Many saw the killings as "an attack on science, a secular state, the intelligence of a nation". In the words of one young man, "they want to drag us back to the Middle Ages."

The fundamentalists did not claim responsibility, but the killings were widely assumed to be the work of Islamic extremists. Although television viewers can watch nightly the dismantling of terrorist rings around Algiers or the pursuit of others in the countryside, and although the Algerian authorities are helped by authorities in Egypt and other North African countries also worried about the fundamentalist threat, it is clear the battle against terrorism is far from won.

Since the army announced a stepped-up campaign against Islamic militants early last December, well over 200 have been killed. Around 3,800 are under arrest and awaiting trial, while another 1,000 are being actively pursued. Undaunted, Islamic terrorists mounted the biggest in a series of raids on army barracks on the same day as the protest marches, resulting in the death of 41 soldiers.

As one Algerian sociologist put it, "it is inconceivable the government can clean up the whole of the country in the near future." He believes the terrorist threat and lack of stability is being used by the government as an excuse not to carry out real reforms. The mass demonstrations of 22 March were directed against fundamentalist terror, but they were hardly a demonstration of popular support for the government.

The regime has been forced to abandon its attempt to coopt Islamic supporters under the banner of "moderate" and still legal Islamic parties, Hamas and Ennahda, which were supposed to participate in the government dialogue with opposition parties. Meetings with the two parties have been "postponed" (probably for ever), leaving the dialogue distinctly one-sided. It is widely assumed that negotiations were aborted by secular hardliners in the army.

Most opposition parties had pulled out of the proposed talks by February, among them seven small parties led by the Front des forces socialistes (FFS) of Hocine Ait Ahmed and the Mouvement pour la democratie en Algerie (MDA) of former president Ahmed Ben Bella. The Berber-dominated Rassemblement pour la culture et la democratie (RCD), fiercely opposed to the fundamentalists, has refused to participate in any talks which include even moderate Islamists.

The critical organisation is the Front islamique du salut (FIS), the officially banned party of the mainstream Islamists. The FIS and other opposition parties won over six million votes in the first round of legislative elections in December 1991. The government wants to wean these protest voters away from the Islamist parties, less to combat terrorism than to try and push through unpopular economic reforms. The prime minister, Belaid Abdessalam, has admitted under pressure from the IMF that he fears there would be an unacceptable level of social unrest if he made the dinar convertible, removed subsidies and privatised companies.

So far government policy has failed with almost all the significant political forces in the country no longer participating in the dialogue. The government's decision not to talk to the two moderate Islamic parties means that the only major political force still left talking is the discredited Front de liberation nationale (FLN), the regime's ruling party of the past which carries most of the blame for 30 years of economic mismanagement.

The aim of the beleaguered Algerian regime in holding the dialogue was to try and improve its image by bringing in other forces from Algerian society to broaden its base of support and thereby legitimise itself. It was trying to perform an impossible balancing act, holding a dialogue only on topics of its own choosing (namely institutional procedures) in order to head off potential electoral troubles. The regime wants to put the memory of the ill-fated 1992 elections firmly behind it, but so far refuses to set a date for new elections.

As a result, no-one is willing to play along. The FFS held a press conference in March to explain its rejection of the dialogue, stating forcefully that the agenda which did not deal with the economic crisis or unemployment or social conditions which were "the real concerns of Algerians" was "irrelevant".

The FFS claimed the aim of the dialogue was to "separate the electorate from political parties." It also demanded to talk to the army directly, rather than through the Higher Council of State (HCS) "whose functions we don't understand." Confident of its social base, the FFS has no wish to tarnish its opposition credentials by being involved with a universally unpopular government. The FFS undoubtedly has a point. The five-man HCS, headed by the lacklustre Ali Kafi, functions officially as a collective presidency. In effect, it is no more than a fig leaf for the armed forces. The real power in the land is General Khaled Nezzar, the minister of defence and a member of HCS.

It is extremely hard to find anyone in Algeria who has a good word to say about the regime. Most people are grumbling. Some say a new revolution is just around the corner. Algiers' residents were worn down by a month's fasting during Ramadan (February-March) and the need to be home before curfew. As always during Ramadan, prices spiralled. This makes the prime minister's envisaged freeze on wages for the next year in a bid to dampen inflation (now running at an annual rate of around 35%) even harder for the population to accept.

When the HCS took power last year under the short-lived leadership of the late Mohammed Boudiaf, it enjoyed the support of its own political class which saw it as the only alternative to an Islamic state. Over the succeeding months, however, backing has steadily eroded as the government seems to have done nothing to resolve the country's underlying problems. "It is attacking the symptoms, not the cause of our difficulties," rails Said Sadi, leader of the RCD.

"At first the government presented its case as a life or death situation and everyone believed it," says one Western diplomat. "But now with continuing violence, a state of emergency, a curfew, ongoing austerity with no end in sight and no new policies to tackle what everyone agrees is a profound crisis, people are starting to ask if this is all there is to life. Everyone is fed up."

Karim, a young Algerian, put it even more strongly. "There will be a revolution. People have had enough. They can't make ends meet. Everyone is alienated from the government. Many passively back the Islamists although they are too afraid to say so openly. The situation is just like it was before the riots in 1988. People just won't take any more."

Others argue that, despite the problems, the probability is the government will hold onto power because its position, with the army behind it, is unassailable - whether or not the majority of the people are happy. The big question is whether growing disenchantment with the Abdessalam government will oblige the army to take over direct control of running the country. It is reluctant to do so, not least because senior officers are themselves divided over the question of making conciliatory gestures to the Islamists or pursuing a policy of rooting out the militants.

It remains to be seen if new measures announced by the High State Council against terrorism (possibly including raising the current state of emergency, indefinitely extended in February, to a state of siege) will have any demonstrable effect. Algerian citizens already complain about the heavy police presence on the streets, the road blocks, the regular searching of vehicles. There are fears that stiffer measures could further antagonise citizens already disenchanted with a regime many see as not only without legitimacy but corrupt, ineffective and lacking in any initiative except for repression.