For CS3 and earlier you would need to use InDesign ME, the version of InDesign sold by WinSoft that is modified for setting Middle Eastern languages. For CS4 and later, the western-language InDesign has a hidden Arabic typesetting ability that you can activate with templates, scripts, or plug-ins.

All you need to know, compiled by Thomas Phinney:

World-Ready Composer in Adobe CS4

The OP is working in CS3 ...

I've tried using several Arabic fonts in CS3 and am having trouble getting the characters to connect properly (they don't connect at all).

Correct. By default, when you type a single character, InDesign picks the "Isolated" form, whereas software designed to work with Arabic automatically use the "Initial", "Medial", and "Final" character forms. If you want to do this by hand: it's not very complicated, but it's a lot of work: select each character, one by one, and look in the Glyphs panel for its alternates. Then pick the appropriate one, by hand. Take care in selecting the correct ones: the right hand side is -- in Arabic Right-to-Left writing -- the "Initial"; all inbetweenies are "Medials", and the left hand side is the "Final".

Note that not all characters come in all 4 shapes; for example, Times New Roman only has Isolated and Final forms for the Alef. I *think* (but I could be dearly mistaken) that the Final form should only be used as such, so in this case you should use the only alternative everywhere else.

I hope you have a good example to work from ... It might be faster and more accurate to do this in Word, print to PDF, and insert as image.

Correct. By default, when you type a single character, InDesign picks the "Isolated" form, whereas software designed to work with Arabic automatically use the "Initial", "Medial", and "Final" character forms. If you want to do this by hand: it's not very complicated, but it's a lot of work: select each character, one by one, and look in the Glyphs panel for its alternates. Then pick the appropriate one, by hand. Take care in selecting the correct ones: the right hand side is -- in Arabic Right-to-Left writing -- the "Initial"; all inbetweenies are "Medials", and the left hand side is the "Final".

I'd not recommend this for any serious work, proper Arabic shaping has more than piking initial/medial/final glyphs (and Arabic characters have infinite number or forms not only four, the only limit is what subset the type designer choose to put in his font), not to mention ligatures (for fonts that have them) or mark positioning.

Khaled: of course. It's as tricky as the OP's "typing in backwards".

For any serious work, one needs the ME version of InDesign -- I'm not sure if CS4's undocumented World Composer hack (and the associated scripts and templates) behaves exactly the same as "the real thing" does.

Can you rate how good Word is with its Arabic typesetting?

I don't use Word myself (or InDesign) but MS's OpenType engine is the "canonical" implementation and it is known for its good complex text support. I've seen some quirks with Kashida justification with Office 2007, no idea if it were fixed in later versions.

thank you everyone... i think i can make it work with the world-ready composer in CS4

You might have a look at "World Tools," recently discussed against IDCS4 ME over in Adobe's InDesign Forum.

David
Oh, wait, as Jongware points out, OP needs CS3

1. http://typophile.com/node/58330
2. http://typophile.com/node/48495
Thanks for posting here:
http://typophile.com/forum/366

Probably not useful to the original poster, but I was making some business cards and simple pamphlets in Arabic a few years ago and gave up on InDesign CS3....

Used MS Publisher 2007 instead (please don't laugh). The designs were simple, so it worked OK.