New terror fears gripped Asia on Tuesday, sparking security scares at embassies and travel alerts, but Indonesia (search) shrugged off calls to outlaw the terrorist group suspected in the deadly homicide bombings (search ) on Bali island.

Investigators were piecing together evidence — pellets, batteries, cables and detonators — from the scenes of the blasts and renewed calls for anyone who recognized grisly photographs of three homicide bombers to step forward.

Two men were being held for questioning, but they have not been named as suspects, said Bali (search ) police chief Maj. Gen. I Made Mangku Pastika, adding that 39 witnesses were also being debriefed.

Southeast Asian nations have gone on high alert to prevent a repeat of the Saturday night attacks on three crowded restaurants that killed 22 people, putting hundreds of thousands of troops on standby, tightening security on beaches and at resorts, and stepping up border security.

Adding to tensions, a Muslim cleric jailed for conspiracy in the 2002 bombings that killed 202 people on the same resort island said Tuesday the latest attacks were a warning from God.

Suspicious packages threatening retaliation for injustices against Muslims were sent to six Asian and European embassies in Malaysia — including Canada, Germany, and Thailand — forcing evacuations and the closure of the Japanese mission.

The parcels were later dismissed as a hoax, as was a tip-off that the U.S. Embassy had also been targeted, said Abdul Aziz Bulat, Kuala Lumpur's police head of criminal investigations.

No one has claimed responsibility for the coordinated attacks that also wounded more than 100 people. But suspicion immediately fell on the Al Qaeda-linked terror group Jemaah Islamiyah — which allegedly orchestrated the 2002 Bali bombings.

Australia, which lost 88 citizens in the earlier attacks, warned Tuesday of further possible strikes on the island and again urged Jakarta to ban Jemaah Islamiyah.

But Indonesia shrugged off the call.

"It is an underground movement. We can only ban an established organization," said presidential spokesman Andi Malarangeng, adding that the government would continue to fight terrorism "under whatever name."

From his prison cell, Islamic cleric Abu Bakar Bashir — the group's alleged spiritual leader — said in a statement that last weekend's blasts were a sign of God's displeasure with the Indonesian government.

"I suggest the government bring themselves closer to God by implementing his rules and laws because these happenings are warnings from God for all of us," said Bashir, who has campaigned for the implementation of Islamic Shariah law in Indonesia.