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All Gurkha veterans who retired before 1997 with at least four years' service will be allowed to settle in the UK, Home Secretary Jacqui Smith has said.
Ms Smith told MPs she was "proud to offer this country's welcome to all who have served in the brigade of Gurkhas".
It comes after a high-profile campaign by Joanna Lumley and other supporters of Gurkha rights - and an embarrassing Commons defeat for the government.