The release from jail of Anwar Ibrahim signals that the era of former strongman Dr Mahathir Mohamad is finally over and Malaysia's new leader is charting his own course, analysts say.

Prime Minister Abdullah Ahmad Badawi, who took over when Mahathir retired last October after 22 years in power, is given credit for freeing the judiciary to deliver the verdict it considered just in a case widely condemned as a frame-up.

The Federal Court, the country's highest, on Thursday overturned former deputy prime minister Anwar's sodomy conviction, criticising the conduct of the police, prosecution and witnesses and saying the trial court had "misdirected itself".

Surprise over the outcome sparked rumours that Anwar and Abdullah had struck a deal under which he would be freed in return for either keeping a low political profile or returning to the fold of the ruling Umno.

Anwar, 57, and his wife, Wan Azizah Wan Ismail, who heads the opposition Parti Keadilan Rakyat, have strongly denied this.

"There was no deal done in the judgement today, absolutely no deal," Anwar said after the verdict.

Logical progression

University of Malaysia political scientist P Ramasamy said he was inclined to believe Anwar.

"In Malaysia, people always think there's something big, some conspiracy. I doubt it. Why should Anwar accept a deal? He has always maintained he is innocent," he said.

"I think it's a matter of Abdullah telling the judiciary 'You make the decision.' Abdullah provided the political context in order for the judiciary to make their own decision."

In contrast, the trial court was widely believed by foreign governments and rights groups to have acted under political pressure when it jailed Anwar for a total of 15 years for sodomy and corruption after he was sacked by then-premier Mahathir in 1998.

"The political climate in Malaysia has changed after Mahathir," said Ramasamy. "Abdullah is not like Mahathir, with his vindictiveness and desire to punish.

"Abdullah wants to clean up the image of his party, so Anwar's release was a logical progression. This is more or less the end of the Mahathir era."

The theme of closure was echoed by Malaysia's major newspapers. The New Straits Times said in an editorial: "Anwar's acquittal should bring the curtains down on one of the most protracted and bizarre political sagas the country has ever seen."

Columnist Joceline Tan said in The Star : "It is the hope of many that his release will mark the start of closure to a contentious period of Malaysian political history rather than the start of another."

Mahathir's reputation

It is an ironic twist to a case that divided the nation that Anwar's possible political rebirth should be seen as coming at the expense of Mahathir's reputation.

Mahathir defended his actions at a news conference after Anwar's release, saying: "I am still convinced that I did the right thing. What I assumed he did, I believe he did."

But when he was asked for advice on how Umno should handle Anwar, he said it was not for him to decide as he was no longer responsible for the party.

"I have my opinion and I will keep it to myself. That's the essence of not being involved. I watch things go on."

Anwar's best chance of regaining a political leadership position lies in a return to Umno, analysts say, but point out that it would be fraught with difficulties given the party's reputation for power struggles and infighting.

If he chooses instead to take over the leadership of Keadilan, he is likely to remain marginalised as Umno has led Malaysia's ruling coalition without serious challenge since independence from Britain in 1957.