President Obama praises Indonesia's 'transformation'

US President Barack Obama has praised Indonesia, the world's most populous Muslim nation, as an example of a developing country embracing democracy and diversity.

Speaking at the University of Indonesia towards the end of his visit to his boyhood home, Mr Obama paid tribute to the nation's ''extraordinary democratic transformation from the rule of an iron fist to the rule of the people''.

Analysts say his address is his biggest attempt to engage the Islamic world since a speech in Cairo last year.