Hillary Clinton is Top US Diplomat

Ending weeks of speculation, Barack Obama nominated Hillary Clinton to be a "tough" secretary of state and persuaded Defense Secretary Robert Gates to stay on but gave him a new mission -- ending the war in Iraq. Vowing to pull-out of Iraq in 16 months, Obama signaled trouble times ahead for the sub-continent.

Announcing his national security team in Chicago, the US president-elect said the decision to enlist Clinton, a former foe, came not in a "light bulb moment" but after a gradual realization there was "no more effective advocate" for US diplomacy.

"She's an American of tremendous stature who will have my complete confidence, who knows many of the world's leaders, who will command respect in every capital," Obama said.

In her new job, the former first lady said she would ignite new momentum in US diplomacy.

"The American people have demanded not just a new direction at home, but a new effort to renew America's standing in the world as a force for positive change," she said.

Obama stuck to his vow to remove US troops from Iraq within 16 months -- a policy Gates has previously expressed doubts about -- but only after consulting his defense secretary and US generals about conditions on the ground.

"I will be giving Secretary Gates and our military a new mission as soon as I take office, responsibly ending the war in Iraq through a successful transition to Iraqi control," said Obama, who takes over the Oval office on January 20.

"As Bob (Gates) said not too long ago, Afghanistan is where the war on terror began, and it is where it must end."

The decision to ask Gates to stay on was meant to send a clear sign of continuity with America locked in wars in Afghanistan and Iraq.

Gates said that with US troops fighting abroad, he had no choice but to stay on.

Obama said the United States would retain the world's strongest military and would chase down terrorists.

"In this uncertain world, the time has come for a new beginning, a new dawn of American leadership to overcome the challenges of the 21st century," Obama said, days after the Mumbai terror attacks sparked a fresh international crisis.

He also sent a clear signal to US foes that his well known opposition to the Iraq war would not mean he would hesitate to commit military force if US interests were threatened.

"To ensure prosperity here at home and peace abroad, we all share the belief we have to maintain the strongest military on the planet," Obama said.

Obama also named former NATO commander and marine general James Jones to be his national security advisor

The new team will take up the reins in January and will have to get US troops home from Iraq, address Iran's nuclear ambitions, and contain deteriorating conditions in the Afghan war.

(Agencies)