Karnataka public transport services across the state were restored to normalcy on Saturday after the government decided to look into the demands of the striking transportation corporations.

Deputy Chief Minister R. Ashok, who also holds the additional responsibility for the transportation department, chaired a meeting on Friday with leaders of the various striking organisations.

After the meeting which lasted for about five hours, Ashok on Friday late night informed reporters that the bus strike would be called off with immediate effect following the government's assurance to consider the demands of the striking transportation unions, including a 30 percent hike in the pay.

Accordingly, the bus services were resumed across the state, ending the two-day transportation ordeal of millions of commuters, including office-goers and students.

Reports say, the core demand for merging the Variable Dearness Allowance (VDA) of 76 per cent with the Basic Salary, after a 10 percent raise, with effect from April 1, 2012, has been accepted in the meeting. Meanwhile, a government panel including the bus trade union representatives will be set up to look into their other demands.

Meanwhile, all the arrested transportation employees would be released, besides withdrawing the show cause notices that were served to the employees during the strike.

Reports suggested that the Transportation Minister was reluctant to enrol more than 30,000 trainees under the regular employee list but went ahead with the decision to hike Rs 1,000 in their monthly salary.

Owing to the breakdown of the public transport, stranded commuters at the bus stops and other places had to turn to autorickshaws and private van services, as about 90 percent of the buses were off roads. Over 1,000 office employees in the city bore the brunt of the transportation strike.