Thousands of protesters near the parliament in Islamabad cheered as ul Qadri announced that the four-day mass demonstration was officially over.
"We have reached an agreement," the Muslim cleric told supporters early Thursday morning in Pakistan's capital city. "I congratulate you. Today is the day of victory for the people of Pakistan. You should go home as peacefully as you came here."
The information minister also congratulated the crowd, following the announcement.
"This is your victory. This is Qadri's victory. This is my victory and this is the people's victory. This is the real face of Pakistan," Information Minister Qamar Zaman Kaira told the throngs of ul Qadri supporters, according to news agency Reuters.
The administration struck a deal after hours of negotiations with ul Qadri. As part of the agreement, the government is to dissolve parliament before March 16 so that elections can take place within 90 days. A transitional government is to oversee the next elections.
Although the concessions differed from ul Qadri's original demands that parliament be dissolved immediately and that the military and judiciary implement reforms before the next elections, the Muslim cleric ended the protests victoriously, according to a South Asia analyst.
"The [Pakistan People's Party] was driven by its interest in making history - being the first civilian government to complete a full term. Technically, if the government dissolves before March 16, it hasn't achieved that goal," said analyst Shamila Chaudhry from the political risk research and consulting firm Eurasia Group, speaking to AFP.
"But the upside is that this situation remains constitutional and, as of now, it appears that a peaceful and democratic transition of power could still be in the cards," Chaudry added.
Tensions dwindled in the capital following the negotiations and the additional news that the prime minister's arrest warrant had been put on hold.
Several hours before completing negotiations on Thursday, Pakistan's Supreme Court adjourned a case calling for the arrest of Prime Minister Raja Pervez Ashraf, along with 16 others, on corruption charges. The judiciary reached the decision after Fasih Bokhari of the National Accountability Bureau called for more time to investigate the allegations.
The case is adjourned until January 23.
kms/jr (AFP, Reuters, dpa)