Nov. 25 (Bloomberg) -- Pakistani former prime minister Nawaz Sharif returned home today from seven years in exile to lead his party in parliamentary elections and oppose President Pervez Musharraf.

Sharif, who has held the post of prime minister twice, landed at Lahore's Allama Iqbal International Airport from Saudi Arabia as thousands of supporters waited to welcome him. He was accompanied by his brother Shahbaz Sharif, and his wife and son.

Sharif's return may help unite opposition leader Benazir Bhutto and other political parties against Musharraf. An opposition alliance, led by Sharif's Pakistan Muslim League-Nawaz, has given Musharraf until Nov. 29 to end emergency rule or face a possible boycott of national elections.

``Sharif and Bhutto have spoken on the phone several times,'' Raja Zafarul Haq, chairman of Sharif's party said in an interview in Lahore today. ``We will now see whether there is a possibility of a meeting between them. So far, Bhutto doesn't seem prepared to join the opposition's call for a boycott.''

Bhutto, who came back to Pakistan last month after eight years in self-imposed exile, has welcomed Sharif's return and said a decision on boycotting elections will be made in consultation with him, Dawn newspaper reported today.

Military Coup

Musharraf, who ousted Sharif in a military coup in 1999, declared emergency rule three weeks ago, fired the nation's top judge and arrested thousands of opposition politicians and lawyers. He has resisted calls from the U.S. to restore the constitution ahead of the national ballot on Jan. 8.

Sharif, dressed in traditional Pakistani clothes, smiled and waved at his supporters as he left the airport with his brother. His supporters chanted slogans of ``prime minister Nawaz,'' waved welcome banners and clapped.

Supporters hoisted the Sharif brothers onto their shoulders and carried them toward their bullet-proof car. The Sharifs stood atop their car and waved at their supporters before leaving the airport.

Sharif, 57, is traveling in a caravan to Data Darbar, the tomb of an Iranian Sufi saint, where he will offer prayers before going to his residence. Thousands of Sharif's supporters lined the route from the airport to the tomb, cheering and clapping.

There were firework displays outside the airport and around the city. Hundreds of green party flags and posters were put up around Lahore, Sharif's political stronghold.

Saudi Intervention

``Sharif's return has been made possible because of Saudi intervention,'' Haq said. ``The Saudi royal family was no longer willing to be part of the old exile deal.'' He said as many as 1,200 party supporters were arrested since yesterday.

Sharif had a ``farewell meeting'' late last week with Saudi Arabia's King Abdullah, said Ahsan Iqbal, a spokesman for Sharif's party. Musharraf and the Saudi monarch also met last week in Riyadh.

``Sharif will be treated very well and will not be arrested or placed under house arrest,'' Musharraf's spokesman Rashid Qureshi said in a phone interview from Rawalpindi before the arrival. ``He will be a free man.''

Sharif was arrested at the Islamabad International Airport on Sept. 10 and immediately deported to Saudi Arabia after he returned to Pakistan following a Supreme Court ruling that he be allowed to return from exile.

Corruption, Treason

Sharif, who was premier from 1990 to 1993 and 1997 to 1999, was convicted of corruption and treason and sentenced to 14 years in prison after the coup. Musharraf pardoned him in 2000 under an accord in which Sharif agreed to live in exile in Saudi Arabia for 10 years. Sharif said he agreed to five years.

The Punjabi government deployed heavy police contingents at the airport ahead of Sharif's arrival. Road blocks and barbed wire were used outside the airport and thousands of riot police were positioned throughout the main roads of the city.

The All-Parties Democratic Movement, which includes Sharif's party and a six-party alliance of religious parties, yesterday gave the government four days to lift emergency rule or face a boycott of parliamentary polls.

The next meeting of the group on Nov. 29 will be chaired by Sharif and a final decision could be taken about a possible boycott, party chairman Haq said.

Pakistan's Supreme Court judges, who were appointed by Musharraf after he imposed emergency rule, last week dismissed all challenges to his re-election. It was then officially certified by the nation's election commission.

Musharraf has been told by the Supreme Court to take a presidential oath for a second five-year term before Dec. 1. He is expected to relinquish his position as head of the army on Nov. 29, said Malik Mohammed Qayum, the government's chief lawyer, according to AAJ television.

To contact the reporter on this story: Khalid Qayum in Lahore, Pakistan on kqayum@bloomberg.net

Last Updated: November 25, 2007 10:51 EST