BBC Tamil service
The Sri Lankan Government has said it will grant citizenship rights to thousands of stateless Tamils of Indian origin.
The British brought the Indian Tamils to upland tea plantations
Indian Tamil leaders say about 170,000 people have no such rights and have been exploited by plantation owners.
The cabinet has approved the move and it will go before parliament in the coming months.
The major political parties back the legislation and it is expected to have a smooth passage.
The island's British rulers brought in Indian Tamils about 180 years ago to work as plantation labourers.
The "Upcountry" Tamils worked mostly on plantations in the central highlands and had little opportunity to mingle with the indigenous Sri Lankan Tamil population in the north and east.
After independence in 1948, the Citizenship Act disenfranchised almost all Indian Tamils.
The 1964 and 1974 agreements between India and Sri Lanka paved the way for more than 375,000 Tamils to become Sri Lankan citizens, while more than 500,000 were designated Indian.
However, about 95,000 of those and their descendants opted to stay in Sri Lanka.
They have since been fighting for citizenship rights.
The Indian Tamils have been unable to buy any property or engage in business.
Prime Minister Ranil Wickremesinghe promised to tackle the issue in his United National Party's manifesto for the 2001 elections.
It is hoped the legislation will end the fears of Tamils that they may be deported to India.
The leader of the Indian Tamil party, the Upcountry People's Front, P Chandrasekharan, told the BBC: "It is an historic decision as previous governments would not have done this, fearing a Sinhala backlash."