Ghannouchi, left, has returned following the recent collapse of the Tunisian government [AFP]

Rachid Ghannouchi, the leader of a formerly banned party, has returned to Tunisia after 21 years in exile.

More than 1,000 people gathered at the main international airport to welcome the leader of al-Nahda as he returned from the UK on Sunday, after the interim government pledged to allow his party and other movements banned under the rule of now ousted President Zine al-Abdine Ben Ali.

"I feel very happy today," the 69-year-old said as he boarded the plane in London.

On the flight with Rachid Ghannouchi

"When I return home today I am returning to the Arab world as a whole... I am still the leader of my party.

"If there are free and fair elections al-Nahda will take part - in the legislative elections, not the presidential elections."

Ghannouchi's party was branded an Islamic terror group and banned by Ben Ali, although he is considered a moderate by scholars.

Supporters crowding the arrivals area of the airport held up banners reading: "No to extremism, yes to
moderate Islam!" and "No fear of Islam!"

A group of about a dozen secularists were holding up banners reading: "No Islamism, no theocracy, no Sharia and no stupidity!"

Al-Nahda was the strongest opposition force in Tunisia before the crackdown that forced Ghannouchi out of the country in 1989. 

Tunisia's interim government has yet to set a date for new elections. Analysts have said al-Nahda could once again rise as a major political force.

However Ghannouchi, who is not related to Mohamed Ghannouchi, Tunisia's current prime minister, has said he does not want to run for any public office.

Source: Agencies