by Tom DiChristopher | @tdichristopher - by cnbc.com - The bold anti-corruption campaign by Saudi Arabia's crown prince and his aggressive foreign policy threaten to undermine his effort to promote a more moderate form of Islam, warns Pulitzer Prize-winning columnist and best-selling author Thomas Friedman. The New York Times columnist, who began his career covering the Middle East and Israel, recently interviewed Crown Prince Mohammed bin Salman, who is widely expected to take the throne in Saudi Arabia. The 32-year-old prince is leading an economic transformation in the world's largest oil exporter and the center of the Sunni Muslim faith. Friedman said Mohammed's campaign to roll back the strict religious atmosphere that has dominated the kingdom since 1979 is the most consequential item on his reform agenda. It would allow the Saudis to overhaul their education system and help rein in a militant strain of Islam that has spread throughout the world, he said. Saudi Arabia recently announced it will lift a long-standing ban on women driving. Under Mohammed, the kingdom can now host concerts and women and men are able to mingle more freely, Friedman said. This marks a dramatic change from the recent past, when Saudi authorities would arrest extremists at the United States' request, but refused to tackle the "war of ideas" in Islam that fueled extremism, Friedman said. "He's taking these guys on at the idea level. What it's doing is it's going to give permission now to everybody else to do that. That is so important.

There is nothing more important than taking this on," Friedman told CNBC's "Squawk Box" on Tuesday. However, Friedman said Mohammed is guilty of "missteps" at home and abroad that could undercut the religious reforms that the Saudi public broadly supports. "I was blown away about how much of this is coming from the bottom up, but ... how he handles these domestic issues and these foreign issues can really undermine him on what is the central project," Friedman said. The prince spearheaded a 2015 invasion of neighboring Yemen that had dragged on and drawn harsh criticism from human rights groups. Earlier this year, Saudi Arabia and its allies sought to force Qatar to change its foreign policy by isolating the tiny Gulf monarchy, but the Qataris have refused to yield. The Saudis appeared to intervene this month in Lebanon's affairs when Lebanese Prime Minister Saad Hariri briefly resigned during a trip to Saudi Arabia. The incident came amid Saudi saber rattling against regional rival Iran, which supports the Lebanese Shiite Muslim group Hezbollah. Around the same time, Saudi authorities began rounding up princes, officials and businessmen as part of an anti-corruption campaign. The detainees were reportedly offered their freedom if they signed over their assets. Middle East watchers, including Friedman, say the arrests are likely aimed atconsolidating Mohammed's power as well as cracking down on Saudi Arabia's well-documented graft problem. Friedman said the process has not been transparent so far and could yet backfire. "This is a pivotal moment, I think, for the crown prince. If this process of arresting these people ... ends with some form of transparency and is done in the context of a rule of law, I think it will strengthen him," he said. "If it doesn't, I think it will weaken him and it will affect both Saudi investors and global investors."

Saudi Prince Released After $1 Billion Settlement, Official Says

Prince Miteb bin Abdullah, one of the most senior Saudi royals detained in a declared crackdown on corruption, has been released after reaching a settlement deal believed to exceed the equivalent of $1 billion, an official said. Prince Miteb, son of the late King Abdullah, was released on Tuesday, the official said on condition of anonymity to discuss matters under the authority of the public prosecutor. At least three other suspects held at the Ritz Carlton hotel in Riyadh have also finalized settlement agreements, the official said. The public prosecutor has decided to release several individuals and will proceed with the prosecution of at least five others, the official said.