Indy had managed to stow away aboard a German U-boat, whose crew had just hijacked the Ark from the tramp steamer carrying it, Indy, Sallah (John Rhys-Davies) and his beloved Marion (Karen Allen) back to America. Reaching the secret Nazi island base in the Atlantic where the treacherous rival to Indiana Jones, Belloq (Paul Freeman), is to perform the ancient rite that will open the Ark, Indy grabs a Nazi uniform and a bazooka and trails the shore party. Belloq and Jones have contended over other relics; the former to sell them to the highest bidder, the latter to preserve the past.
The test of Indy's character comes when he confronts the Nazis, with the Ark and Marion in their custody. Indy threatens to blow up the Ark, destroying it utterly. Hauptmann Dietrich (Wolf Kahler) is unable to believe Indy would destroy the Ark but cannot dismiss the possibility that he might. At that moment, it is Belloq who steps forward and challenges Indy to go ahead and "blow the Ark back to God". Belloq has no weapon but his own words and knowledge of his longtime foe:
"All your life has been spent in pursuit of archaeological relics. Inside the Ark are treasures beyond your wildest aspirations. You want to see it opened as well as I. Indiana, we are simply passing through history. This... this IS history."
And from that moment, it is impossible for Indy to pull the trigger. Belloq knew exactly how to call Indy's bluff, and Indy showed himself for the academic he really is before adventurer or mercenary or anything else.
It would, of course, have been easy to employ any cheap plot twist to stop Indy from carrying out his threat. But this one turned on the whole developed character of Indiana Jones in the movie and that is why this one little scene has such power. Belloq disarms Indy simply by playing upon his own curiosity and passion to preserve the past. It is a natural outgrowth of the plot and the character design in Lawrence Kasdan's script and it meshes wonderfully in all its elements. It also sets up how Indy and Marion survive at the end, because the academic Jones pays attention to the lore behind ancient relics which the mercenary Belloq dismisses as mere superstition.
That is filmmaking done the right way.
