To be sure, the Reserve Bank of India is already playing a central role in supporting the economy from the crisis.

It has slashed its benchmark repo rate by 150 basis points to 7.5 per cent since mid-October and has cut bank reserve requirements by 350 basis points to put more cash into the banking system.

The Reserve Bank is widely expected to cut rates again soon to boost sagging investor confidence, which took a further knock from the militant attacks.

"The economic challenges are more in the area of monetary policy, that's why the burden will now shift to the Reserve Bank of India rather than the finance ministry," D.H. Pai Panandikar, president of private think-tank RPG Foundation.

DIFFICULT YEAR, FEW CHOICES

Attacking two luxury hotels used by local and visiting business executives and targetting foreigners were widely seen by analysts and the media as attempts to undermine India's growing economic and diplomatic clout.

With such a heavy workload, Panandikar said Singh would lean heavily on two close aides, Planning Commission Deputy Chairman Montek Singh Ahluwalia and former chief of his Economic Advisory Council, C. Rangarajan.

Singh resisted the temptation to name one of the two men as finance minister because neither belonged to his ruling Congress party. Naming them could have riled senior colleagues ahead of parliamentary elections due by May in a party known for its factional bickering.

With elections around the corner and newspapers daily reporting popular anger over a series of bombings and gun attacks, Singh's top priority will be internal security.

... contd.