Formerly known as the British Commonwealth of Nations, the Commonwealth is a loose association of former British colonies, dependencies and other territories, as well as Mozambique, which has no historical ties to Britain, the news agency explained.
The Commonwealth Ministerial Action Group praised the progress President Pervez has made towards democracy since he seized power in 1999 from elected prime minister Nawaz Sharif.
Pakistan was suspended from the 53-nation group's decision-making councils after General Musharraf ousted Sharif
After a recent meeting in London, the group also swore it would also continue to monitor "continuing concerns in regard to the strengthening of the democratic process in Pakistan."
Diplomats said the United Kingdom and Australia wanted to reward Musharraf for helping fight al-Qaida, the BBC said.
Pakistan's information minister, Sheikh Rashid, said the country welcomed the decision, noting: "It is the right decision at the right time. We have fulfilled all the requirements and it's a wise decision."