BBC's Jonathan Head: Students cannot believe elections will produce a legitimate government

Parliamentary Speaker Harmoko said government and parliamentary leaders had agreed that the elections will be held on 7 June.

President BJ Habibie has been under mounting pressure to hold early elections since his predecessor, former President Suharto, was forced to resign in May.

Thousands of students again marched peacefully through the streets of Jakarta calling for the trial of former President Suharto and demanding elections to be free and fair. Security forces blocked them reaching parliament.

The latest protests come after a series of bloody anti-government protests last month in which at least 14 people died.

Election within deadline

Speaker Harmoko said the People's Consultative Assembly would meet to choose a new president following the election.

Analyst Wimar Witoelar: No guarantees elections will be fair

Under former President Suharto only three political parties were allowed to take part in elections and his own Golkar party was guaranteed victory.

But more than 80 new parties have formed since Mr Suharto's May resignation, although only a minority are expected to contest the poll.

BBC Jakarta Correspondent Jonathan Head said the elections date was the last possible under a deadline set by last month's special Assembly session.

President B.J. Habibie: Still under pressure

The government has argued that it cannot possibly organise such an undertaking in less time.

This argument appears acceptable to most opposition parties which need to to establish a network of local support.

The parliament has still not decided what electoral system will be used next June.

Our correspondent says it looks likely that most parties will agree to stick with an entirely proportional system, whereby members win seats in electoral regions according to their party's share of the national vote.