Sri Lanka's Supreme Court ruled Friday that President Chandrika Kumaratunga's final term expires in December, ending her controversial 11-year reign and clearing the way for a vote before November 21.
Opposition activists took to the streets and exploded fire crackers outside the Hulftsdorp Courts complex after the five-judge bench delivered a unanimous decision to a packed court room guarded by armed police and troops.
"It is a unanimous decision," said Chief Justice Sarath Silva, ending months of wrangling between the president's People's Alliance and the opposition on whether her term ends this year or in 2006.
Sri Lanka's stock exchange reacted positively, with the All Share Price index jumping 1.5 percent as brokers said the end of political uncertainty had cheered investors.
Analysts saw the court decision also boosting the island's peace prospects with an election returning a president with a new mandate to jump start peace talks on hold since April 2003.
The Norwegian-led peace talks could be revived by a new president elected with a fresh mandate, said Sunanda Deshapriya, director of the Centre for Policy Alternatives think-tank.
"The next few months will be crucial to maintain the cease-fire," Deshapriya said. "A president elected for a six-year term with a new mandate should be able to end the stalemate in the peace process."
Diplomatic sources close to the Norwegian-led initiative said while they had not expected face-to-face peace talks between the two sides to resume anytime soon, the ending of political instability was seen as a positive development.
President Kumaratunga had argued a left-over year from her first term should mean she could stay in office until late 2006. Her new government which came to power in April last year failed to secure agreement with Tiger rebels on re-starting peace talks.
She was first elected in 1994 and instead of completing the first six-year term, called a snap poll in 1999.
The chief justice, who is a personal appointee of the president, in his 25-page judgement ruled her second and final term will end on December 22.
The National Heritage Party (NHP) took the issue before the Supreme Court saying it wanted presidential polls held this year.
NHP spokesman and lawyer Udaya Gammanpila hailed the ruling. "This is not a victory for our party or the defeat of one individual," Gammanpila told AFP. "This is victory for democracy-loving people of this country. It is now up to the voters to choose a patriotic leader."
Officials said under the presidential elections act, the vote would have to be held in a period of one month ending midnight on November 21, a month before Kumaratunga's term expires.
The main opposition leader, Ranil Wickremesinghe, had also called for elections this year to allow the country to choose a new leader and revive the island's stalled peace process with Tamil Tiger rebels.
Wickremesinghe, who is the main opposition contender for the presidency, narrowly lost to Kumaratunga at the December 1999 poll which was conducted three days after she lost her right eye in a suicide bombing blamed on Tigers.
"Today is a victory of people's power," Wickremesinghe told reporters here at his party headquarters. "People's sovereignty cannot be taken away. When the government tried to deny their right they expressed their opposition."
There was no immediate reaction from the president to the ruling, but a top aide said she would remain active in politics.
"We see a very active political role even after she leaves office as president," Kumaratunga loyalist Mangala Samaraweera told AFP. "She has already accepted to take up a decision-making role in the party."
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