Your figure is not that accurate. Muslim's population in Indonesia is about 90 % of total population. 5 % is Christian, and the rest is Hindus, Buddhas, or Atheist. That is about 190 million Muslims. And the Muslim extremist that we should be feared of is less than 1 %.
The implication of Howard's irresponsible statement may dampen Australia's effort to fight against terrorism. I read in many Asian newspapers that some SouthEast Asia nations will review its antiterrorism pact with Australia, in fear of foreign military involvement in their soils.