Mr Shen was arrested with two Chinese companions shortly before a scheduled news conference. Two French journalists travelling with him were briefly detained and put on a flight to Hong Kong, according to Ross Terrill, an American Sinologist who is a member of the advisory board of Mr Shen's US-based Democracy for China Fund.
Mr Shen, a leader of the 1989 pro-democracy movement, travelled through China for four weeks, meeting members of the underground democracy movement, dissidents, intellectuals and former officials, said Mr Terrill, who came to Peking to witness his return. 'He's not talking about direct political activity, he's talking about the building blocks,' Mr Terrill said. The Australian-born academic said Mr Shen had put about 20 to 30 Chinese on the payroll of his fund, an act certain to infuriate China's Communist Party, which tolerates no challenges to its power.
One of the dissident's goals, said Mr Terrill, was to have his organisation engage in business activities 'to generate money to be used against the communist cause'. When police took Mr Shen from his mother's home in Peking, they also removed documents and computer disks he had been working on. Mr Shen's mother later received a written message from her son, saying he was being questioned in a hotel.
Mr Shen said at the weekend he hoped to register a branch of his organisation with the Chinese authorities, so that it could work in China. 'Exiles need to come back here,' he said. 'To transform China, people need political alternatives.' Asked if his return was an attempt to recreate the 1989 pro-democracy movement, he said: 'It never stopped.'
Mr Terrill confirmed that Mr Shen had encountered resistance to his plans and methods. Some Chinese intellectuals who met him said that he had lost touch with China's conditions after spending three years abroad. 'Now is not the time,' said a respected intellectual who declined Mr Shen's invitation to join his effort.
Mr Terrill said he thought the arrest of Mr Shen, who has been active politically in the US, could affect China's ties with Washington. 'I think you can expect ripples in US-China relations if they hold him a long time or do anything drastic,' he said.