The INLA is said to have rejected moves to join up with the hardline splinter groups Real and Continuity IRA to carry on with the armed struggle.
According to the reports, the INLA's political wing, the Irish Republican Socialist Party, said that the group prefers to promote the idea of a non-aggression pact between Northern Ireland's mainstream loyalist paramilitary groups and the Provisional IRA.
The INLA declared a ceasefire on 22 August last year, after a bloody campaign of violence which saw several feuds within the organisation.
Unionist politicians responded to the declaration with caution. Ulster Unionist MP Jeffrey Donaldson said: "If the INLA are calling a complete end to their campaign of violence, then it follows, like day follows night, that they will have to decommission."
Ian Paisley Jnr, the DUP's justice spokesman, said : "This is a meaningless charade by the INLA ... to take the spotlight away from the fact that fellow republicans [are] under immense pressure over the killing of Charles Bennett and arms smuggling from the United States."
Alex Attwood, the nationalist SDLP's policing spokesman, said: "If any paramilitary grouping has reached the conclusion the only way forward is through dialogue, normal politics and non-violence, then that has to be welcomed."
The Government and Ulster politicians tried to play down claims that Tony Blair had a secret, face-to-face meeting with members of the Provisional IRA's Army Council during last month's peace talks, during which an offer to decommission weapons by May 2000 was made.
A Downing Street spokesman insisted: "All the Prime Minister's contacts with the republican movement have been through Sinn Fein. The Prime Minister met leading representatives of all pro-agreement parties who have members elected to the Assembly. The outcome of those discussions is well known."
A Sinn Fein spokesman described the story was "absolutely and categorically not true".
He continued: "The story is rubbish. The only people who spoke to Tony Blair and Bertie Ahern were Sinn Fein negotiators, Gerry Adams and Martin McGuinness.
A 45-year-old man is due to appear at Belfast magistrates court today charged with the murder of Charles Bennett. Mr Bennett, 22, was found hooded and shot in the head near the Falls Road last week.Reuse content