"After consultations with my legal advisers and close political friends, for the country and the nation today, I am deciding to resign from my office," a teary-eyed Musharraf said.

"I am leaving with the satisfaction that whatever I did for this country and the population, I did with honesty and commitment.

"But I am also a human being," he added. "I might have made some mistakes, but I have hope that this nation and the population will tolerate those mistakes with the belief that my intentions were always clear and to the benefit of this country."

Rumours persisted that Musharraf was going to resign to avoid charges of impeachment that were to be levelled against him in parliament later this week.

Pakistani officials say that Musharraf's aides have held talks with the ruling

coalition, brokered by Saudi Arabia, the US and the UK, to allow him to quit in return for an indemnity for his previous actions.

Kamal Hyder, Al Jazeera's correspondent in Islamabad, said that a tremendous amount of speculation about Musharraf's resignation had built-up before the announcement, following the threat of impeachment by Pakistan's ruling coalition.

"The timing was significant. There were reports of a heavy amount of security at the airport, and that an aircraft was on the tarmac, and that the president might resign."

"The euphoria on the streets is quite evident. This is a man who became very unpopular."

Hyder said that the fact that the major coalition partners have been able to set their differences aside is a positive change in Pakistani politics.

"There will be an interim president until a president can be elected and of course this will be a president who will not have the sweeping power that General Musharraf had.

"This will also be a president who will give all the executive powers to the prime minister and of course who will return the sovreignty of parliament where it is supposed to be.

In his address, Musharraf, wearing a dark suit and tie, said that Pakistan was "his life" and he took time to list a number of economic and political developments during his term as Pakistan's president.

"Pakistan first has been my philosophy," Musharraf said, adding that he had worked in "good faith" in the face of challenges including militancy and economic problems.

"Unfortunately, some elements acting for vested interests levelled false allegations against me and deceived people," he said, in a scathing attack on his opponents.

"They said that during the last nine years our economic problems and electricity shortages were due to our policies. It is absolutely wrong and deception for the country.

"They never realised that they [opposition] could be successful against me, but they never thought how detrimental it would be for the country."

Shah Mahmood Qureshi, Pakistan's foreign minister, said on Monday that it appeared that Musharraf had no option at this stage but to resign.

"He is a wise man, he is a very experienced man and he has seen the writing on the wall," Qureshi told Pakistan's Dawn News earlier in the day.

"He has seen the sentiments of not just the elected representatives, but various institutions ... who all asked him to move in a particular way and do not destabilise things here."

Musharraf added that he introduced the "essence of democracy" to Pakistan.

"Everyone says I'm an army man, against democracy. I think that's wrong," he said.

On Sunday, there was speculation that a deal might have been reached enabling Musharraf to resign without fear of prosecution.

But the ruling coalition said it was against any deal that would grant him legal immunity.

Coalition officials said on Saturday that a draft of the impeachment charge sheet was still awaiting approval from senior leaders.

Musharraf's spokesman said last week that his resignation might be dependent on what his rivals are willing to offer - in particular if they will give him legal immunity and let him stay in the country.

Condoleezza Rice, the US secretary of state, said on Sunday that the US was not currently considering granting asylum to Musharraf.

Speculation that Musharraf could be forced into exile heightened with the visit of Muqrin bin Abdul Aziz, Saudi Arabia's intelligence chief.

Divisions have also appeared in the ruling coalition with respect to allegations of treason, raising the likelihood of impeachment proceedings.

Sadiqul Farooq, a spokesman for the Pakistan Muslim League-N (PML-N), headed by Nawaz Sharif, a former prime minister, whom Musharraf ousted in a 1999 coup, said legal guarantees were out of the question.

Sharif's party is the second largest in the coalition, and has said Musharraf should be tried for treason, which carries a maximum punishment of death.

"It will be in the interest of the country and the nation to make him an example in accordance with the constitution and the law," Farooq said.

Sherry Rehman, the information minister, and a top PPP member, however said that the party "never indulges in the politics of revenge as it wants a stable Pakistan and a sustainable democracy in the country".

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