Almost two months after Iraq's elections, the winning Shia alliance yesterday chose the prime minister, Ibrahim Jaafari, to head the first full-term government since the fall of Saddam Hussein.

The nomination of Mr Jaafari, a softly spoken physician exiled in Iran and Britain under the Ba'athist regime, is seen as a crucial step towards full sovereignty. But the breakthrough was tempered by fears a new administration could take weeks to form, prolonging uncertainty at a time of rising sectarian violence and stalled reconstruction. Insurgents killed at least six people and wounded 20 yesterday.

Mr Jaafari, of the Islamist Dawa party, squeezed home by just one vote ahead of the vice-president, Adel Abdel Mahdi, a leading member of the Supreme Council for Islamic Revolution in Iraq (Sciri), after a poll among members of the largest party, the United Iraqi Alliance.

A western diplomat in Baghdad, speaking on condition of anonymity, said: "The UIA comprises nine or 10 parties, the Sunni groups five or six, and the Kurds two or three. In effect we are seeing coalitions of coalitions trying to reach consensus over policies and posts."

Mr Jaafari's nomination was met with ill-disguised displeasure by Kurdish coalition partners, led by the Iraqi president, Jalal Talabani, who favoured Mr Abdel Mahdi. He was also disliked by his Kurdish coalition partners, who accused him of arbitrary decision making, ignoring agreements to resolve the status of Kirkuk, and of condoning the random arrests of Sunni Arabs by Shia-dominated security forces.

Though Mr Jaafari is respected by many Shias as an honest and pious figure, he was criticised for failing to improve basic services such as water and electricity.

His success owes much to the bitter Shia rivalry between the radical cleric Moqtada al-Sadr and Sciri.

"It is a complicated process that could take weeks," said Nadim al Jabari, a leading UIA figure. He predicted a government would not be in place until late March.