Manmohan Singh, a widely respected economist who served as finance minister from 1991 to 1996, was chosen Wednesday as India's next prime minister following the surprise decision by the Congress party leader, Sonia Gandhi, to turn down the job that was hers for the asking.

Bowing to the wishes of the Italian-born Gandhi, who announced her decision Tuesday night, Congress lawmakers unanimously elected Singh, a former technocrat who also has the support of allied parties that will join Congress to form the ruling coalition in the lower house of parliament, the 545-seat Lok Sabha.

Accompanied by Gandhi, Singh, 71, formally staked his claim to the prime minister's job at a meeting Wednesday night with President Abdul Kalam, clearing the way for Singh's swearing-in this week.

"I am happy to inform the nation that the president has invited me to form the next government," Singh said after the meeting. "I feel humbled. . . . The nation had given this mandate for Sonia Gandhi," he said as Gandhi, who was expected to retain significant power in the new government, stood by, smiling.

Though Congress leaders continued to bewail Gandhi's decision, which came after protests by Hindu nationalists enraged by the idea of turning over the country's most powerful office to a foreign-born woman, the choice of Singh has been widely applauded.

Born into a farm family in colonial-era Punjab, Singh studied economics in India before heading to Cambridge and then Oxford. Married with three daughters, he has held top economic policymaking jobs, including that of reserve bank governor, and has worked for the International Monetary Fund.

As finance minister in the most recent Congress-led government, Singh won admiration among business leaders and investors for opening the economy to the outside world and dismantling the socialist-era system of business permits and import restrictions known as the "license raj."

He has signaled that he will take a different approach to economic liberalization than the government of Prime Minister Atal Bihari Vajpayee, whose Hindu nationalist Bharatiya Janata Party had been criticized by Congress and its allies for policies that hurt the poor.

In remarks to reporters Wednesday night, Singh described the new government's approach as "economic reforms with an emphasis on the human element" -- a formulation that in practice is likely to mean a slowing of efforts to sell off public-sector industries that remain an important source of jobs. That position has reassured leaders of India's two main communist parties, both of which have offered their qualified support to the governing coalition.

"Fundamentally, he is a sound economist, and certainly I think he believes in markets, and his historic legacy from 1991 to 1993 was one of profound change," said Gurcharan Das, an author, newspaper columnist and former chief executive of Procter & Gamble India. "We really do owe him a very big debt."

At the same time, Das said, "I wish personally that he had made a greater effort to convert members of the Congress party to the markets much more. . . . He's too gentle. He's timid."

Singh is a Sikh who would be the first member of a religious minority to hold the top job in this nation of more than 1 billion people. His selection as parliamentary leader and prime minister was a bittersweet moment for the Congress party lawmakers. They had expected Gandhi to take the prime minister's job after Congress and its allies scored a stunning upset over Vajpayee's Hindu nationalist-led coalition in national elections that ended last week.

But Hindu nationalist leaders, including some members of Vajpayee's party, said they would continue to make an issue of Gandhi's foreign origin. Associates of the Congress leader said she was rattled by the vehemence of the protests and influenced by the fears of her two grown children, Rahul and Priyanka, that her life could be at risk if she assumed such a high-profile position.

"Basically, she doesn't want even a semblance of civil strife," said Rasheed Kidwai, a journalist and the author of a recent biography of Gandhi. "She realizes that she would face problems in this environment of xenophobic nationalism."

For her part, Gandhi said in explaining her choice Tuesday night that she had never hungered for the prime minister's job and that her main goal -- now realized -- had been to reestablish the primacy of the Congress party and the secular values it represents.

Gandhi's decision has been hailed in the news media as a selfless and shrewd gesture -- one that has flummoxed the Hindu nationalist opposition while enhancing her party's moral standing and, with it, that of the Nehru-Gandhi political dynasty that she will continue to lead.

"Amazing Grace" read the banner headline in Thursday's Hindustan Times, an English-language daily in New Delhi.

"By choosing to 'humbly decline,' she has played a masterstroke," the Indian Express newspaper said in its lead editorial Wednesday.

Though Gandhi said her decision was final, some party workers have refused to accept it. A handful of senior Congress officials resigned in protest, and party supporters smashed windows at a Congress office near Gandhi's official residence, where hundreds of others gathered to voice their dismay.

In a statement Wednesday, Gandhi pleaded with the party to support Singh. "I understand your disappointment," she said. "But I appeal to you to understand the depth of my sentiment when I say that I cannot reverse my decision."

Gandhi will remain a powerful force. She will keep her seat in Parliament and stay on as president of the party. She will also serve as leader of the Congress lawmakers in Parliament, with Singh -- a member of the Rajya Sabha, or upper house -- as her deputy. "I'm not going away," Gandhi assured Congress lawmakers who gathered on Wednesday to formally anoint Singh in her stead.

Gandhi, 57, is the widow of Rajiv Gandhi, who was prime minister from 1984 to 1989 and was assassinated while campaigning for reelection in 1991. Rajiv Gandhi was the son of Indira Gandhi, who was prime minister when she was assassinated in 1984, and the grandson of Jawaharlal Nehru, the champion of Indian secular democracy and India's first prime minister, from 1947 to 1964. Sonia Gandhi's son, Rahul, was elected to Parliament from a district in Uttar Pradesh state last week.

Special correspondent Rama Lakshmi contributed to this report.

Manmohan Singh, left, and Sonia Gandhi announce after a meeting with President Abdul Kalam that Singh, 71, will form the next Indian government. Gandhi was expected to become prime minister, but turned down the job.