Estonia's outgoing prime minister has been designated to form a government in a decision that likely will bring a populist, eurosceptic party to power for the first time in the Baltic nation.

The 101-seat Riigikogu legislature voted Wednesday 55-44 to give Juri Ratas, Estonia's government head since 2016 and leader of the left-leaning Center Party, the green light to form a three-way coalition.

Kaja Kallas, leader of the center-right Reform Party that won the March 3 election, was first tasked to form a government but failed to get sufficient support.

Ratas this month clinched a surprise deal with the nationalist, anti-immigrant Estonian Conservative People's Party and the conservative Fatherland.

The trio would muster a majority of 56 seats in Parliament, which is set to approve the government on April 29.