Since the unravelling of Western colonialism in the mid-twentieth century, Muslim countries (for example, Turkey, Egypt, Sudan, Morocco, Pakistan, Malaysia, and Algeria) have experienced difficulties in attempting to establish a viable synthesis between Islamic political movements and ideas and the state in their respective localities. In these countries the political relationship between Islam and the state has been characterized by severe tensions, if not hostilities. Given the preponderant position of Islam in these regions, that is, being the religion of the majority of their inhabitants, this is indeed a puzzling reality. As such it has attracted many students of political Islam to raise the question as to whether or not Islam is actually compatible with a modern political system, in which the idea of the nation state serves as a major ingredient.

In Indonesia Islam has long been at an impasse in terms of its political relationship with the state. The regimes of both Presidents Soekarno and Soeharto regarded political parties based on Islam as potential power contenders capable of undermining the nationalist basis of the state. Primarily because of this, both the regimes worked to contain and “domesticate” the Islamic parties. As a result, not only did the leaders and activists of political Islam fail to make Islam the state ideology and religion in 1945 (on the eve of Indonesia's independence) and again in the late 1950s (during the Constituent Assembly debates over Indonesia's constitutional future), but they also found themselves repeatedly labelled “minorities” or “outsiders”.