DHAKA, Bangladesh -- Shafik Rehman, editor of the largest weekly magazine in Bangladesh, was flabbergasted when he picked up a fundamentalist newspaper a few weeks ago and saw a story claiming that he was a fugitive from justice, charged with insulting Islam. It was news to him.


"I said to my wife, 'This gives the fundamentalist workers the green signal to attack me,'" Rehman said in a recent interview, noting that police had never served a warrant on him, so he had no way of knowing that he was wanted. That night, three Molotov cocktails were thrown at the front gate of his house.


"These are intimidation tactics to scare me so I will refrain from writing against the fundamentalists," said Rehman, whose magazine also publishes columns by Taslima Nasrin, the feminist author who emerged Wednesday from two months in hiding to appear in court on charges of insulting Islam.


Rehman and Nasrin are in the forefront of an increasingly violent surge in religious fundamentalism affecting Bangladesh, which traditionally has embraced a more moderate form of Islam. Extremists, concerned about deteriorating Islamic values and the rising independence and power of women, have launched a propaganda war against journalists and private aid groups, accusing them of corrupting Islam.


But the dispute is about the clash of commercial and political interests as well, according to observers here. Political analysts charge that the government of Prime Minister Khaleda Zia, weakened by a five-month-long opposition boycott of parliament, has tolerated, if not abetted, the rise in fundamentalism to curry favor with extremists and to divert attention from domestic problems.


The government denies pandering to religious extremists.


While not discounting the ideological aspects, observers here said the campaign against aid organizations is being orchestrated by religious leaders who are also angry that they have lost students -- and, thus, money -- to schools run by the groups. Furthermore, according to journalists, the rise in religious extremism is being fueled in part by a newspaper war started by Inqilab, the fundamentalist paper, to increase its circulation, which has plunged with the rising popularity of more moderate papers.


"Inqilab is trying to rebuild its circulation by selling a rise in fundamentalism to the believers and at the same time helping the cause of Islam," Rehman said.


In his own case, which effectively was decided in his favor by the Supreme Court two weeks ago, Rehman was accused of insulting Islam by including a joke at the end of his regular column equating a man's sex organ with the first letter of the Arabic alphabet. Because that letter is also the first letter of Allah's name, he was accused of blasphemy by Islamic fundamentalists.


The fallout from these religious, economic and political clashes has raised tensions to the boiling point.


In recent weeks, tens of thousands of fundamentalists have taken to the streets demanding enactment of a blasphemy law, calling for the expulsion of Western-funded aid groups, known as non-governmental organizations or NGOs, and demanding that Nasrin be executed. Half a dozen people have been killed and scores have been injured in clashes with police.


Newspaper offices have been ransacked. Another editor's house was bombed last week. Four more editors and reporters were recently arrested for allegedly insulting religious sentiments, following the more than 150 reporters and editors who have been arrested for "defamation" in the last three years.


Outside the capital, extremists have torched dozens of schools run or funded by aid organizations. The two main targets are the Grameen Bank and the Bangladesh Rural Advancement Committee, which have won accolades around the world for programs educating, employing and giving small loans to women in rural areas.


"We have no objection to improving the lot of women, but the motives of the NGOs are completely different," said Maulana Azizul Haque, a leading fundamentalist cleric in Dhaka.


"When NGOs come to the village, they have to understand the social pattern -- women live under the guidelines of the father, husband, brother and son," he said. "Now NGOs are taking women out of their houses and giving them training and drilling into their heads: 'Why do you have to remain under your father, husband and brothers? You can be independent.' In this way they are destroying the family system in our country."