An investigation into South Africa's President Jacob Zuma has found evidence of possible corruption at the top level of his government.

In the report, former Public Protector Thuli Madonsela recommends Mr Zuma establish a judicial commission of inquiry within 30 days.

Mr Zuma is accused of an improper relationship with wealthy businessmen.

He had tried to block the release of the report, but dropped his court bid on Wednesday.

The 355-page report calls for further investigation into potential abuses, including the purchase of a mine by Tegeta, co-owned by the president's son, Duduzane Zuma.

"If [Mineral Resources Minister Mosebenzi] Zwane travelled in his official capacity to support Tegeta's bid to buy the mine his conduct would give Tegeta an unfair advantage over other interested buyers," the report notes.

"Further, it is potentially unlawful for the Minister to use his official position of authority to unfairly and unduly influence a contract for a friend... This scenario would be further complicated if his actions were sanctioned by the President."

The president and ANC leader has been dogged by corruption allegations for more than a decade, but has repeatedly denied any wrongdoing.

Ms Madonsela investigated allegations that he let the wealthy Gupta family - who co-own Tegeta - wield undue influence in his government.

The Guptas were accused of trying to nominate cabinet ministers in exchange for business favours. Both Mr Zuma and the Gupta family have denied the allegation.

Image copyrightAP

Image captionOpposition parties have repeatedly accused Mr Zuma of being corrupt, which he denies

But the report reveals Deputy Minister of Finance Mcebisi Jonas told the public protector he was offered 600m rand (£36.2m/$44.6m) in an account of his choice by Mr A Gupta if he agreed to become finance minister.

The report continues: "He asked if Mr Jonas had a bag which he could use to receive and carry R600,000 in cash immediately, which he declined."

Mr Zuma's office said the decision to abandon a court bid to block the report's release was made "in the interest of justice and speedy resolution of the matter".

"The president will give consideration to the contents of the report in order to ascertain whether it should be a subject of a court challenge," the statement added.

Opposition parties, who had challenged Mr Zuma's move, are now demanding that he pays their legal costs.

Image captionThey have vowed to step up their campaign to oust him

Thousands of people gathered in the capital Pretoria and in other cities on Wednesday ahead of the report's publication, demanding Mr Zuma's resignation. Police fired water cannon to disperse protesters.

The protesters, supporters of the Economic Freedom Fighters (EFF) party, had gathered outside Mr Zuma's main administrative offices in Pretoria.

Opposition groups are also rallying in South Africa's other major cities.

Democratic Alliance (DA) leader Musi Maimane said state coffers were being "plundered" by "crooks", but the "good guys" were winning in the battle to safeguard the democracy which emerged in South Africa at the end of minority rule in 1994.

"This is about letting Zuma, the Guptas and all their useful idiots know that their days are numbered," Mr Maimane said.

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Final straw for Zuma?: Pumza Fihlani, BBC News, Pretoria

Image copyrightAFP

Image captionMr Zuma is under intense pressure to resign

President Zuma's move was unexpected but it has been welcomed. So why the U-turn?

"He's acknowledging that he has no grounds to prevent the release of the Report on State Capture," said constitutional expert Lawson Naidoo.

For many South Africans who have harboured doubts about whether Mr Zuma should stay in power, his close relationship with the wealthy Gupta family is the final straw.

Although all concerned have denied any wrongdoing, many feel Mr Zuma can no longer be trusted to act in the best interests of the country and its hard-fought constitution.

This is why thousands of people from various opposition parties marched through the streets of Pretoria, calling for Mr Zuma to go.

It is not clear what Mr Zuma's next move is, but he is under pressure from all sides, even many in the governing African National Congress (ANC).

As for South Africans, they say the time of sitting idly by is over - they are fighting back.

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Ms Madonsela's investigation was triggered by allegations in March by Deputy Finance Minister Mcebisi Jonas that the Gupta family had made "a mockery of our hard-earned democracy" by offering him the finance minister's post last year.

Mr Jonas said he rejected the offer; the Guptas denied the allegation and accused him of political point-scoring.

Former ANC MP Vytjie Mentor also alleged that the family offered her the powerful public enterprise minister's post in 2010 in exchange for business favours.

Ms Mentor alleged that Mr Zuma was in another part of the Guptas' family home in Johannesburg when the offer was made. Mr Zuma's office said at the time that he had no "recollection" of Ms Mentor, while the family strongly denied her allegation.

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The Guptas in South Africa:

Image copyrightGALLO IMAGES

Image captionJacob Zuma's son Duduzane (right) was a business partner of the Guptas until recently

• Ajay, Atul and Rajesh Gupta moved to South Africa from India in 1993
• Set up businesses in air travel, mining, energy, technology and media
• Opposition nicknamed them and the president as "Zuptas" because of their close relationship
• Deny influencing ministerial appointments to advance their business interests
• Accused of being involved in "suspicious" transactions worth about $490m (£400m)
• Say they are withdrawing from their South African businesses because of political backlash
• Big banks have refused to do business with them

Who are the Guptas?

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Ms Madonsela had planned to release the report last month, before the end of her seven-year term as South Africa's public protector.

The investigation is her second into Mr Zuma since he took office in 2009.

In March, South Africa's highest court upheld her earlier findings that Mr Zuma "unduly benefited" from government money used to upgrade his private rural home.

It led to widespread calls for Mr Zuma to resign, but he survived an impeachment vote in parliament after ANC MPs rallied behind him.

Correspondents say that Mr Zuma will almost certainly face another impeachment vote if there are any adverse findings about him in the latest report.

The president is also at the centre of another case and is trying to overturn a unanimous ruling of a High Court that he should stand trial on 783 counts of corruption in relation to an arms deal negotiated in 1999.

Mr Zuma's term as president is due to end in 2019.