The UK has agreed to hand over the Chagos Islands to Mauritius, ending years of bitter dispute over Britain’s last African colony.

The agreement will allow a right of return for Chagossians, who the UK expelled from their homes in the 1960s and 1970s, in what has been described as a crime against humanity and one of the most shameful episodes of postwar colonialism.

However, there will be an exception for the key island of Diego Garcia, which is home to a joint UK-US military base, and which will remain under UK control. Plans for the base were the reason the UK severed the Chagos Islands from the rest of Mauritius when it granted the latter independence in 1968 and forcibly displaced up to 2,000 people.

There was a mixed reaction to the announcement from Chagossians, not all of whom are happy that sovereignty has been handed to Mauritius.

But Olivier Bancoult, chair of the Chagos Refugee Group, who was four years old when his family was deported to Mauritius, welcomed it, describing it as “a big day”.

“This has been a long struggle lasting more than 40 years and many of our people have passed away,” said Bancoult, who had mounted a series of legal challenges over the sovereignty of the islands in the UK courts since 2000. “But today is a sign of recognition of the injustice done against Chagossians who were forced to leave their homes.”

He said it was not yet clear how many Chagossians would like to return to the islands, many of which are uninhabitable. While acknowledging that those born on the largest island – Diego Garcia – would not be able to return, he expressed hope that Chagossians could be prioritised for jobs there.

Bancoult, who was part of a historic 2022 trip to the islands, which included the Mauritian ambassador to the UN, Jagdish Koonjul, raising his country’s flag above the atoll of Peros Banhos in a ceremony, added: “If Mauritius will not fulfil its responsibilities to us of course we will raise our voices.”

The first of 13 rounds of negotiations began in 2022, representing an abrupt change of approach after years of the UK defying court rulings – including a 2019 advisory opinion from the UN’s highest court – and UN general assembly vote, which all said it should return the islands to Mauritius. The agreement is subject to a treaty that the parties will seek to conclude as soon as possible.

An attempt to halt the negotiations, on the basis that the Chagossians were not consulted or involved, failed.

Chagossian Voices, a community organisation for Chagossians based in the UK and in several other countries, said of Thursday’s announcement: “Chagossian Voices deplore the exclusion of the Chagossian community from the negotiations which have produced this statement of intent concerning the sovereignty of our homeland. Chagossians have learned this outcome from the media and remain powerless and voiceless in determining our own future and the future of our homeland.

“The views of Chagossians, the Indigenous inhabitants of the islands, have been consistently and deliberately ignored and we demand full inclusion in the drafting of the treaty.”

A joint statement from the UK and Mauritius governments said the agreement would “address wrongs of the past and demonstrate the commitment of both parties to support the welfare of Chagossians”.

The UK foreign secretary, David Lammy, said the UK government had secured the future of the military base, while the US president, Joe Biden, welcomed the agreement as a “clear demonstration that … countries can overcome longstanding historical challenges to reach peaceful and mutually beneficial outcomes”.

Despite Biden’s endorsement, and the fact that negotiations were begun under the Conservative government, all four Conservative leadership candidates – including James Cleverly, who as foreign secretary, announced the discussions – condemned the deal as being harmful to the UK’s interests.

The security of the Diego Garcia military base was further complicated by the fact that more than 60 Tamil refugees, hoping to reach Canada after setting sail in a boat from southern India, have been stranded on the island for three years. A ruling about whether or not they have been unlawfully detained there is expected imminently.

Human Rights Watch (HRW), which said in a report last year that the UK should pay full and unconditional reparations to generations affected by the forcible displacement of islanders, lamented the deal.

Clive Baldwin, senior legal adviser at HRW, said: “The agreement says it will address the wrongs against the Chagossians of the past but it looks like it will continue the crimes long into the future.

“It does not guarantee that the Chagossians will return to their homeland, appears to explicitly ban them from the largest island, Diego Garcia, for another century, and does not mention the reparations they are all owed to rebuild their future. The forthcoming treaty needs to address their rights, and there should be meaningful consultations with the Chagossians, otherwise the UK, US and now Mauritius will be responsible for a still-ongoing colonial crime.”