Afghanistan's Independent Election Commission (IEC) on Monday announced cancellation of the November 7 runoff presidential election, declaring the incumbent Hamid Karzai the winner.

The decision was announced by the chairman of the Election Commission, Azizullah Ludin while addressing a news conference in Kabul.

The development came in the wake of Sunday's announcement by Karzai's sole rival in the second round election, former Foreign Minister Dr. Abdullah Abdullah, to withdrew from the race.

Abdullah, who had, ever since the August 20 election, been demanding runoff polls, agreed to contest when the Election Commission announced last week to hold the second round voting on November 7, following the Election Complaint Commission [ECC] discarded over a third of Karzai's votes, bringing down his victory proportion to less than the required above 50 percent.

According to the preliminary election results, Karzai had won more than 54 percent of votes while Abdullah and other candidates alleged rigging in the election, prompting the ECC to withhold result of more than 300 ballot boxes for scrutiny.

Last week, Abdullah put a number of conditions for Karzai government, including sacking of election commissioner Ludin, saying he would not take part in the runoff if his demands were not met.

The UN-backed Election Commission had already sacked over 200 of its employees, including its some provincial chiefs; in those areas election fraud had been alleged.

Both Abdullah and Karzai sides held talks on last Thursday to discuss the conditions and -- according to Western diplomats -- modalities for a formation broad-based coalition government.

Media reports say Dr. Abdullah also demanded clipping of some powers of the president.

However, the talks collapsed inconclusive following which Abdullah gave Saturday deadline for meeting his conditions.

On refusal by the government, he announced his withdrawal from the race on Sunday, causing political stalemate in the country as the election body said the time for boycott of the polls had lapsed while the country's constitution does not offer any solution if such a situation arises.

Now the Independent Election Commission decision has though clarified the scene, lending legitimacy to Karzai, yet it remains to see whether his new administration -- coming in wake of election fraud charges and allegations of massive corruption -- would stand the test of national and international credibility -- a thing direly needed for the resource-starved nation that is still in the eye of the Taliban storm.

UN Secretary General Ban Ki-moon, who -- during a surprise visit to Kabul, met both Karzai and Abdullah on Monday -- welcomed the decision to cancel the runoff election and congratulated President Hamid Karzai on being handed a second term in office.

"I welcome today's decision by Afghanistan's Independent Election Commission to forego a run-off vote and to declare Hamid Karzai as the winner of the 2009 presidential elections," Ban said in a statement.

Furthermore, U.S. President Barack Obama, Pakistani President Asif Ali Zardari, Indian Prime Minister Manmohan Singh and some other countries including China, Canada, Britain and Turkey has congratulated Karzai over his reelection.

Earlier, U.S. Secretary of State Hillary Clinton had downplayed significance of Dr. Abdullah's withdrawal from the election race.

"I don't think it has anything to do with the legitimacy of the election," Clinton told reporters in the United Arab Emirates.

"It's a personal choice which may or may not be made," she said.

The London-based newspaper, Telegraph reported on Sunday that "the crisis in Afghan is so bad that we don't have time to waste on electoral niceties."

"Better to scrap the whole thing and let Karzai and Abdullah work out whether they can form a government of national unity. Now, that really would be progress."

The new situation emerged in Kabul as Obama administration is seriously deliberating on revising its several-month old policy on Afghanistan and considering request by its top military commander in Afghanistan, General Stanley McChrystal, for additional 40,000 soldiers to counter the much emboldened Taliban and Al-Qaida fighters in the country.

The question of a legitimate administration in Kabul is in the heart of a decision for such a decision as American and Western public opinion is skeptical about future prospects of their Afghan mission in the absence of a strong and representative government in Kabul.

Although president Karzai enjoys the support of powerful political figures from all major ethnic communities of Afghanistan, like Mohammad Qasim Fahim, Karim Khalili, Ustad Mohaqqiq, and General Dostum, yet Dr. Abdullah has, in recent weeks, emerged as a formidable challenger to his authority.

Besides reduction in powers of the President, Abdullah has also been promising to work for introduction of a parliamentary system, which shows he would continue to pose problems for the incumbent president in future.