'Hotel California' in Osama's Old Stamping Ground

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Evelyn Hockstein / The New York Times / Redux

Young Sudanese hang out at Ozone Cafe, a hot new night spot in Khartoum, which features an outdoor air-conditioning system spraying a cooling mist.

People are scurrying home as darkness falls over Khartoum. The muezzin has long since called the faithful to their evening prayers, and women clutch headscarves over their hair and shoulders as the streets in the city center are starting to empty.

But as the city outside settles down for the night, inside Papa Costa's, the party is only just getting started. Aid workers jostle for space on the dancefloor with young Sudanese women who are content to let their scarves slip to their shoulders as a five-piece band hammers out a mixture of North African pop and rock 'n roll jukebox standards.

"This is a typical Sudanese band," says Omar Yahia, 50, the proprietor of Papa Costa's restaurant, "one of twenty that used to exist. They would play live and compete with each other more than thirty years ago." That was before the Islamists seized control of Sudan, all but banning live music and imposing curfews that kept people at home.

Today, however, there are hints of gradual relaxation of restrictions, spurred by a peace agreement and booming oil revenues — a handful of musicians has returned from self-imposed exile to test the limits of the new tolerance.

"We have been open for a year and a half and in the beginning it was very difficult. There was a stiff investigation to get a permit for a night like this," says Yahia as the band finishes up a song by Algerian rai music legend Khaled, before launching into a cover of The Eagles' "Hotel California." "But slowly things are getting easier."

Yahia's family story chronicles Sudan's turbulent political history. In 1969, his father had been a minister in President Jafar Nimeiry's government, but was later placed under house arrest. The family fled Sudan in 1974, and Yahia was educated in Britain and France before moving to Colorado, where he worked as a graphic designer. Meanwhile, back home, things were getting worse.

Nimeiry had a penchant for authoritarian systems, dabbling first in state socialism before opting for political Islam and imposing Sharia law in parts of the country. Musicians were arrested and private parties at which bands played were broken up by Nimeiry's goons. Little changed when Nimeiry was ousted. In 1989, Omar al-Bashir came to power in a military coup. He was backed by Hassan al-Turabi, the Islamist ideologue who invited Osama bin Laden to settle in Khartoum in the mid-1990s. But when al-Bashir signed a peace deal with Christian rebels in the south, allowing non-Muslims into the government and paving the way for a more inclusive Sudan, Yahia took the opportunity to come home.

"I'd always wanted to come back," he says, sitting in the open courtyard of his restaurant beneath the stars. "What brought me back was my age — I don't care if I get shot — and it was just after the signing of the peace treaty. That was encouraging. At last there was no more war. There was a kind of political stability."

Despite the music at Papa Costa's, things are moving slowly.

Risque websites are filtered out by state-owned Internet service providers, and last week eight daily newspapers were seized after their editors refused to submit copy for approval. Fashionable coffeeshops have posted warning signs that dress and behaviour must be "respectable". And the owners of a handful of restaurants known to discreetly serve alcohol to foreigners were arrested last year.

Still, the Sudanese capital, flush with oil revenue, is in the the throes of an economic boom despite U.S. sanctions. New hotels and office complexes are rising across the city, as investment pours in from the Gulf States and China. And, sanctions or not, the ultimate status symbol visible in Khartoum's most fashionable neighborhoods is the Humvee.

Diplomats say prosperity has raised tensions between hardliners and pragmatists in the government. The differences were highlighted last year by the case of Gillian Gibbons, an English teacher jailed after her class of seven-year-olds named a teddy bear Mohammed. She was convicted of insulting Islam's Prophet, but was released days later with a presidential pardon.

Professor Hag Ateya Elteyb, director of the Peace Research Institute at Khartoum University, says the government has been unable to maintain its hard line in the face of the growing number of outside influences arriving in the country as a result of its oil boom, and also because of the Darfur crisis. "Now we have more and more foreigners and investors, there's a new thing happening very slowly as the government relaxes because of these groups," he says. "I don't know if it's good or bad, but the repressive element is going."

Nowhere is that more visible than at the traffic islands and verges close to the Nile. At dusk on Thursday evenings the grass is dotted with dozens and dozens of young couples. "This is where young men and women come to spend time together," says a taxi driver in an old, battered yellow Toyota. "If they had done this 10 years ago the police would have come with sticks."