Benazir's absence, political analysts say, will inevitably refuel speculation that she will cut some deal with Musharraf either before or after elections due this year or early 2008, that could pave the way for her Pakistan People's Party to join the ruling coalition and her eventual return to Pakistan.

The All Parties Conference, to be hosted by another exiled former premier Nawaz Sharif, is due to be held on March 24-25 to chalk out an anti-Musharraf campaign ahead of the elections.

"Benazir will not be there and we have informed the PML-N about this," said Farhatullah Babar, spokesman for Benazir Bhutto's PPP, referring to Sharif's Pakistan Muslim League party.

Benazir Bhutto will send representatives, Babar said.

Sharif, who was ousted by General Musharraf after a bloodless coup in 1999, and Benazir had appeared to set aside old enmities when they signed a Charter of Democracy last year, and joined an Alliance for the Restoration of Democracy in the wake of the military takeover.

But Benazir, who went in to self-exile in 1998, leaving behind a raft of corruption cases, has met several times with Musharraf's emissaries in London and Dubai in the past few months.

Babar said Benazir Bhutto's decision to stay away was based on a number of reasons, including her party's various reservations about the presence of the Islamist opposition at the conference.

Musharraf is expected to obtain another five-year term by being voted in again by either the sitting national provincial assemblies, or those returned by the forthcoming elections.

Analysts say he would need Benazir Bhutto's support if he is to push through policies of enlightenment and moderation.

"For Musharraf, Benazir Bhutto is the best option for the continuation of his liberal policies," said Mutahir Ahmed, a professor at the University of Karachi's International Relations department.

Musharraf has ruled out allowing exiled political leaders to return for elections and in January denied that his government was contemplating any deals or seat adjustment with political rivals. But ministers in the ruling coalition have talked up chances of accommodating Benazir Bhutto.

"I would say the nation will hear some good news before the elections as the People's Party cannot sit with extremists," Railways Minister Sheikh Rashid Ahmed said. "Benazir has no option but to sit with President Musharraf."