Clearing the decks for Indian doctor Mohamed Haneef's return, the Australian government has on Wednesday decided not to appeal against the reinstatement of his visa by the Federal Court.

Immigration and citizenship minister Chris Evans said he would not proceed with an appeal to the high court in light of advice from the solicitor-general in the case of the 27-year-old Bangalore medico, who was wrongly accused of links to the failed United Kingdom terror plot in 2007 and forced to leave the country.

"However, I have sought advice from my department on the ramifications of the Full Federal Court decision for the operation of the character provisions of the Migration Act," Senator Evans said.

"Upon receipt of that advice, I will consider the need for any legislative amendment," Evans said.

The Federal Court had restored Haneef's work visa on December 21, 2007 after he was exonerated of the terror charges.

Haneef's work visa was cancelled by the then immigration minister Kevin Andrews on character grounds because of his relations with UK terror suspects Sabeel and Kafeel Ahmed, soon after he was granted bail by a court.

The Federal Court's decision means Haneef will be able to return to Australia to work under the conditions of his current 457-day temporary long stay visa should he wish to do so.

Haneef was employed by Queensland Health as a medical registrar at the Gold Coast Hospital.