Hong Kong leader Leung Chun-ying warned Wednesday that demands for fully free elections risked "anarchy" as he pledged allegiance to Beijing and pro-democracy lawmakers staged a dramatic walk-out.

Leung took a hard line on political reform in his annual address, saying there would be no deviation from Beijing's framework for the city's leadership elections in 2017.

"The rule of law is the foundation of Hong Kong. The democratic development of Hong Kong must therefore be underpinned by the same. As we pursue democracy, we should act in accordance with the law, or Hong Kong will degenerate into anarchy," he said.

In his first speech to Hong Kong's legislature since huge street rallies calling for free leadership elections, Leung made no concessions to protesters and questioned their understanding of the intricacies of politics in the semi-autonomous Chinese city.

Authorities in Hong Kong and Beijing consistently branded the mass protests illegal.

"Hong Kong's power originates from the central authorities (in Beijing)," said Leung.

"Hong Kong's autonomy... is a high degree of autonomy, not an absolute autonomy."

Beijing has ruled that candidates for the city's first ever public vote for its chief executive in 2017 must be vetted by a loyalist committee, which campaigners denounce as "fake democracy".

They say they would rather have no vote than one in which the candidates are restricted, and have consistently called for Leung -- who was himself appointed by a pro-Beijing committee -- to resign.

But Leung reiterated that any vote for the city's top post must adhere to Beijing's ruling on vetting candidates.

"The selection of the chief executive comprises both the elements of election and appointment," he said.

He added that students -- who led two months of mass protests which ended in December -- "should be guided towards a full understanding" of Hong Kong's relationship with Beijing in order to prevent "fruitless" discussions.

- 'Unprecedented' speech-

Leung's comments echo a white paper handed down by Beijing's cabinet in June which lit the touch paper for the pro-democracy movement after it asserted that China had "comprehensive jurisdiction" over governing Hong Kong.

The city is ruled under a "one country, two systems" structure since former colonial power Britain handed it back to China in 1997, giving it greater freedoms than seen on the mainland.

But there are growing fears over increasing Chinese influence.

Around 20 pro-democracy lawmakers walked out of the legislative council chamber and two were bundled out by security before Leung's speech.

Carrying banners and yellow umbrellas, the symbol of Hong Kong's pro-democracy movement, they shouted: "Down with CY Leung! True universal suffrage!".

Security guards surrounded two members of the People Power party who refused to leave and were shouting "shameful" at Leung.

Chan Chi-chuen and Chan Wai-yip were eventually carried out.

Leung, whose address was delayed for 15 minutes, gave a faint smile and busied himself reading through his speech as the protests continued.

Political analyst Joseph Cheng described the strong tone of his address and its content as "unprecedented".

"It was unprecedented (for a policy address). CY was clearly showing there are no concessions with regards to political reform issues, toeing Beijing's line," he told AFP.

The chief executive usually lays out domestic policies for the year ahead in the annual address, which this year also covered issues including the economy, housing, transport and support for the elderly.

But it had a much heavier political message than usual, said Cheng.

He said it was "significant" that Leung had driven home the inextricable link between Hong Kong politics and Beijing.

"The pro-democracy movement should understand that it is a long-term struggle politically and there is no significant breakthrough in the foreseeable future," he added.