Anger over the 1MDB scandal prompted Mahathir to emerge from retirement and sparked the anger that helped to oust Najib's coalition.
The world's oldest elected leader is now Tunisia's 91-year-old president Beji Caid Essebsi.
The party is in the alliance that won power at the hard-fought poll.
Weeks earlier in September 1998, Prime Minister Mahathir Mohamad sacked Anwar as his deputy.
Almost two decades after fleeing on a motorcycle to escape from police only to suffer a black eye while in their custody, Anwar Ibrahim is on a journey likely to propel him to the top spot in Malaysia's government.
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The National Front's leader Najib Razak was swept aside after his reputation became tarnished by a corruption scandal and an unpopular crackdown on dissent.
Anwar's wife, Wan Azizah, also reinforced the idea that the king was eager to grant the pardon, commenting that: "if the director of prisons is satisfied. then [Anwar] may be released in two to three days".
"It is going to be a full pardon, which of course means that he should not only be pardoned, he should be released immediately when he is pardoned", Mahathir told reporters, a day after being sworn in as Prime Minister. Malaysia's politics has been bedevilled for years by at times troubled relations between the ethnic groups that make up the country.
"President Donald J Trump congratulates Tun Dr Mahathir Mohamad on his having been sworn in today as the new Prime Minister of Malaysia", White House Press Secretary Sarah Sanders said in a statement. She is the first female deputy premier in Malaysia, but the current set-up is seen as transitional as Mahathir has agreed to hand over the baton to Anwar once he is freed.
"The new government vows to uphold democracy, justice and human rights for all", said the statement, delivered by the vice-president of his party, Tian Chua, who was visiting the leader in hospital. They're in coalition, but with only 13 seats in parliament Mr Mahathir's new party Bersatu is much smaller than Anwar's Keadilan, with 47.
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He said as part of an out-of-court settlement, Boudchar would receive 500,000 pounds ($677,000). "The UK government believes your accounts.
Meanwhile, speculation was mounting about Najib's future with a senior member of his party, former sports minister Khairy Jamaluddin, calling for "big changes" to be made without delay.
But soon after winning a second term in 2013, 1Malaysia Development Berhad (1MDB), a fund launched by Najib to promote economic development, slid into a massive debt hole and allegations surfaced that money was missing.
He denied any wrongdoing and was cleared by Malaysia's attorney-general, even as United States authorities alleged that over $4.5 billion was stolen from the fund in a fraud orchestrated by a financier known to be close to Najib and his family.
It also called on Mahathir to abolish repressive laws such as the recently imposed Anti-Fake News Law, which it says is "designed to stifle debate online".
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