London: Conservative leader David Cameron took over as Britain's new Prime Minister, ousting the Labour party from power after a 13-year rule, after striking an agreement with the Liberal Democrats.
Cameron assumed the top post last night after Queen Elizabeth II invited him to form the new government following the resignation of incumbent Gordon Brown during a 15-minute audience at the Buckingham Palace last evening.
Installed at the No 10 Downing Street, Cameron thus becomes the youngest prime minister in almost 200 years, since Lord Liverpool, who assumed office at 42.
Lib Dem leader Nick Clegg has been named as the Deputy Prime Minister.
The coalition government:
The agreement over power-sharing came after five days of hard bargaining between the single-largest party and the kingmaker Clegg's party, following which four other Liberal Democrats also received Cabinet posts.
The Conservative Party said ex-leader William Hague will serve as Foreign Secretary, senior lawmaker George Osborne as Treasury chief, and lawmaker Liam Fox as Defence Secretary.
Other leading positions were being finalised, as were key policy decisions ahead of the presentation of the coalition's first legislative program on May 25.
Both parties have made compromises, and Cameron has promised Clegg a referendum on his key issue: Reform of Britain's electoral system, aimed at creating a more proportional system.
While details of the government's programme are yet to be formally announced, reports said the two parties in the coalition agreed upon a referendum on an Alternative Vote system and plans for five-year fixed-term parliaments.
Also read: Gordon Brown resigns as Prime Minister
Their priority will be to spur a once high-flying economy, rooted in world-leading financial services, that has run into hard times.
At least 1.3 million people have been laid off and tens of thousands have lost their homes in a crushing recession. Cameron has pledged an emergency budget within 50 days.
In Cameron's first speech after being named the Prime Minister, he said one of his major tasks would be to rebuild trust in the political system.
"Yes, that's about cleaning up expense, yes, that's about reforming parliament and yes, it's about making sure people are in control and that the politicians are always their servants and never their masters," he said.
"Nick Clegg and I are both political leaders who want to put aside party differences and work hard for the common good and for the national interest," Cameron said.
A new foreign policy?
Britain's new government could spell changing relationships with its foreign allies.
Both Cameron and Clegg have signaled they favor looser ties to Washington than those held by Brown and his predecessor, Tony Blair. Cameron and Clegg back the Afghanistan mission but Cameron hopes to withdraw British troops within five years. Clegg has said he's uneasy at a rising death toll.
Relations with European neighbors could also become problematic. Cameron's party is deeply skeptical over cooperation in Europe, and has withdrawn from an alliance with the parties of Germany's Angela Merkel and France's Nicolas Sarkozy. Clegg, once a member of the European parliament, has long been pro-European.
India and Cameron:
India was the first country Cameron visited after taking over as the Conservative leader in 2006.
He has promised to forge a "new special relationship" with India and support India's bid for a seat in the United Nations Security council.
His party's manifesto says that the party will "work to establish a new special relationship with India, the world's largest democracy".
It also commits the party to support India's bid for a seat in the UN Security Council.