The incoming Barack Obama administration is likely to appoint veteran troubleshooter Richard C Holbrooke as a special envoy to Pakistan and India amid tensions in the sub-continent following the Mumbai terrorist strikes.

Obama's Secretary of State-designate Hillary Clinton may name Holbrooke, a longtime diplomat who brokered the Dayton accord that brought peace to Bosnia, as the special envoy, the New York Times quoted "people who have been told of the decision" as saying.

The media report comes even as a Congressional report warns that the fallout from the Mumbai terrorist attacks could further complicate "US policy in South Asia."

"The Administration of President-elect Barack Obama may seek to increase US diplomatic efforts aimed at resolving conflict between these two countries," the Congressional report, released on Wednesday, said.

It cautioned that the incoming administration should stay away from any "high-visibility" focus on Kashmir issue as it would likely evoke Indian resistance and risk fuelling Pakistani expectations of a settlement favouring Islamabad.

The Times also reported that Clinton will keep respected career diplomat William J Burns, who was the pointsman of the Bush Administration on the Indo-US nuclear deal, as the Under Secretary for Political Affairs.

She is also closing in on naming special emissaries to trouble spots in the Middle East and Iran, the report said.