NEW DELHI -- Indian Prime Minister Atal Behari Vajpayee is expected to swap his finance and foreign ministers on Monday in a move seen as signaling a new drive to liberalize India's economy.

A senior source in Vajpayee's ruling Bharatiya Janata Party (BJP) said on Saturday Indian Finance Minister Yashwant Sinha was expected to swap jobs with External Affairs Minister Jaswant Singh in a mid-term cabinet reshuffle.

The decision to move Singh, seen as the more effective of the two, to the Finance Ministry appeared to underscore a new focus on economic reforms after an easing in a standoff with Pakistan which brought the nuclear-armed neighbors to the brink of war.

"Sinha swapping places with Jaswant Singh is absolutely sure," the senior party source said.

Vajpayee has been under pressure to revitalize the 20-party coalition government after a string of defeats for the BJP in state elections earlier this year, including in Uttar Pradesh, India's biggest state and the party's traditional stronghold.

Many BJP members blamed Sinha for those defeats, for failing to deliver strong economic growth and for introducing policies which alienated the middle classes, the BJP's core constituency.

But the reshuffle was delayed due to the military standoff with Pakistan, which eased only after Pakistan President Pervez Musharraf promised to stop Islamic militants crossing into Indian Kashmir to join a revolt against Indian rule.

Close to a million men are mobilized at the border and India has said it will keep its army there until it is convinced Musharraf will deliver on his promise.

*********Getting Down to Business Analysts said the planned reshuffle indicated that for now at least the focus was shifting to driving through economic reforms.

"Jaswant Singh has a successful track record in the Foreign Ministry," said Saumitra Chaudhri, economic advisor with credit rating agency ICRA Ltd.

"Prime Minister Vajpayee and BJP leaders are now looking at elections two years down the line and with the economy in tardy shape they have to have some track record and tell voters what they have achieved," he added.

The next elections are due by 2004 with a string of state elections due before that. "It (the reshuffle) is trying to give a sense of direction to both party and the government," political analyst Mahesh Rangarajan said. "The shifting is also possibly a sign of further de-escalation of tension in the region."

The senior party source said three or four ministers, including Rural Development Minister Venkaiah Naidu, Law Minister Arun Jaitley and Urban Development Minister Ananth Kumar, would be moved to work for the party to improve its electoral chances.

Naidu was expected to take over as the party's next president from Jana Krishnamurthy, he said.

"Three youngsters but experienced are being sent to the party to tone it up and arrest the sense of drift," said Rangarajan.

SUBHEAD********Singh Seen as Problem-Solver At the same time as toning up the party, the expected appointment of Singh was seen as an attempt to deliver on the BJP's electoral promises to liberalize the economy while also pushing economic self-sufficiency for India.

Singh is a patrician ex-soldier who represents the liberal market-friendly face of the BJP.

As foreign minister, he has been one of the strongest advocates of closer ties with the United States, reversing India's traditional cold war alliance with Moscow.

"In the last two or three years India has faced difficult times on the external relations front but Jaswant Singh has tackled the problems successfully," said D.H. Pai Panandikar of the private economic think-tank, RPG Foundation.

"He has tremendous capacity to deal with problems and the markets will accept him as a good finance minister," he said.

Indian economic growth rose to 5.4 percent in the financial year ending in March 2002 -- high by most countries' standards but not high enough in the country of one billion people to make any serious dent on poverty.

Private economists say India needs more reforms -- currently bogged down in the face of resistance by unions, government allies and the opposition -- if it is raise its growth rate.

Sinha, also a pro-Western free marketeer, is seen as a relatively safe pair of hands at the Foreign Ministry, Reuters reported.