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Dr Mohamed Haneef will be allowed to leave Australia but the Government will not reinstate his work visa, Immigration Minister Kevin Andrews said.
The decision meant Haneef could leave Australia as early as last night, which his lawyers said he was keen to do.
Haneef had been incarcerated since his arrest at Brisbane airport on July 2 in relation to the foiled bomb attacks in the United Kingdom in late June.
Despite the charge being dropped on Friday, Australian Federal Police Commissioner Mick Keelty said the investigation was still continuing.
Haneef was released from a Brisbane jail into residential detention last night, hours after a charge against him of providing support to a terrorist organisation was dropped.
Andrews, who cancelled Haneef's work visa on July 16 when a Brisbane magistrate granted the doctor bail, yesterday said the visa remained cancelled.
Haneef's lawyer Peter Russo said Haneef was to fly home to India last night but would continue to fight to have his Australian work visa reinstated.
Russo, who will fly with Haneef to India, said Andrews should immediately reinstate his client's visa.
Andrews said Haneef's lawyers had contacted the Immigration Department asking if the doctor could leave Australia as soon as possible.
"After taking advice, including from the Australian Federal Police, I have indicated that the commonwealth has no objection to Dr Haneef leaving Australia. Indeed the effect of the visa cancellation is that he should remove himself, he should depart Australia in any event," he told reporters in Melbourne.
Andrews said Haneef's Indian passport would be given back to him, although his visa remained cancelled.
Russo has lodged an appeal against the decision to cancel the visa in the Brisbane Federal Court, with a hearing scheduled to take place on August 8.
- AAP
