KATHMANDU, Nepal – King Gyanendra of Nepal announced a humbling compromise with his democratic opponents yesterday that may save his throne after almost three weeks of protests that have brought Nepal close to collapse.

“The dissolved house of parliament has been reinstated by this announcement,” he said. “We offer condolences for the lives lost during the agitation.”

At least 14 people have been shot dead by security forces in protests against the king’s autocratic rule.

Diplomats from America and India, Nepal’s giant neighbor, were involved in brokering the restoration of parliament, which was dissolved by feuding politicians in 2002 before Gyanendra seized absolute power 15 months ago.

The king said parliament would sit again on Friday.

A senior source in the Nepali Congress (NC), the largest political party, told the Daily Telegraph its leadership would accept the offer, which satisfies the minimum demand of seven opposition parties.

During a day of rumor, there were frantic efforts behind the scenes to complete the deal before a feared showdown planned in Kathmandu today. Political parties had called for two million people to take to the streets in defiance of curfew orders.

A senior NC source said that during the negotiations security forces assured the opposition that they were willing to submit to civilian control, while the parties told them they would ultimately be punished if more civilians were killed in protests.

Maoist rebels waging a 10-year insurgency against the monarchy flexed their muscles with a raid on a district capital on Sunday. Hundreds stormed the town of Chautara, 60 miles east of Kathmandu, and fought a six-hour gun battle that killed at least five rebels and a soldier.

Diplomats had warned that if the king failed to reach out to his enemies his reign could come to an end within days as protests ran out of control.

The recalled parliament is likely to call for peace talks with the Maoist rebels, who control most rural areas, under a plan laid out between the rebels and the parties last autumn. It is ultimately linked to writing a new constitution.

Mahav Kumar Nepal, the leader of the United Marxist Leninist Party which, despite its name, is a moderate parliamentary group, said: “They will need a guarantee that events lead to a constituent assembly involving them.”

Many foreign governments, including Britain, lost credibility with the Nepali public when they accepted the king’s Friday compromise.

He offered to hand executive power to the seven-party alliance, but they rejected the concessions out of hand.

The following day, 300,000 protesters defied a curfew and marched on the centre of Kathmandu demanding improved terms.

Events today will show whether the demonstrators follow their leaders in accepting the king’s latest offer.