By M Ilyas Khan BBC News, Karachi

Asif Zardari (left) now becomes the PPP's de facto leader

The party has also decided to contest parliamentary elections, due on 8 January.

The first decision appears to be aimed at preventing internal divisions in the party, while the second is meant to take at high tide the sympathy wave for the PPP that has been caused by Ms Bhutto's assassination last Thursday.

But in effect, the PPP would be run by Ms Bhutto's husband, Asif Ali Zardari, until Bilawal completes his studies and is ready to assume the party's leadership.

This brings Mr Zardari into direct focus as the party's de facto chief, faced with the immediate challenge of guiding it through the elections.

PPP's 'second founding'

And the shrewd manner in which the question of succession has been decided indicates that he may well prove to be as tough a customer for President Pervez Musharraf as his late spouse.

PPP TOP LEADERS Asif Ali Zardari Benazir's widower and former political ally, has faced corruption and other charges Bilawal Bhutto Benazir's son, a 19-year-old Oxford University student, considered too young by some PPP members Makhdoom Amin Fahim Senior PPP figure and top aide to Benazir Profile: Bilawal Bhutto Mourners blame Musharraf Search for stability continues

Ms Bhutto represented the dynastic legacy of her charismatic, populist father, Zulfikar Ali Bhutto, who ruled the country in the 1970s.

And she bore resemblance to him in everything, including her populist style of politics, her charisma, and even her death.

Her father was overthrown in a military coup and hanged in 1979, following a controversial trial. Her assassination last Thursday appeared to have turned back the clock for PPP supporters.

This time the succession issue has been resolved by a hand-written will that the party's 55-member executive committee says Ms Bhutto left behind and in which she has nominated her husband as her successor.

Aware of the divisions it may cause in a party that was unlikely to accept a non-Bhutto at the top, Mr Zardari has passed the mantle on to his son, who has renamed himself as Bhutto.

So, in what is termed by some observers as the "second founding" of the PPP, Mr Zardari has stepped into Ms Bhutto's shoes to pick up the challenges that the party has traditionally faced from an often hostile establishment.

'Fast learner'

The question is, can he meet those challenges?

Supporters of Benazir Bhutto blame the government over her death

With her charisma and long political experience, Ms Bhutto had evolved into a shrewd negotiator with a sharp sense of timing.

Analysts credit her with negotiating her way back into the country after an eight-year-long exile, and building up an impressive election campaign - all by exploiting the needs of the military rulers as well as her former political rivals.

The opinion in Pakistan is that Mr Zardari has shown himself to be a fast learner in the past, and the immediate challenge of elections will help him galvanise his skills quickly.

He has had considerable political experience as an unofficial advisor of Ms Bhutto when she was prime minister in the 1990s.

But he also earned the reputation, within the party, of being someone who used Ms Bhutto's influence and clout for his personal gain, and he subsequently became the subject of judicial inquiries both within the country and abroad.

He says those charges were politically motivated, and that none of them have led to a conviction in ten years.

This, and the fact that he remained in jail for eight years without compromising with the military regime, have reassured some party loyalists.

His decision to go into elections - despite a 40-day mourning period announced by the PPP - is seen by analysts as being designed to put the government, which was hoping the PPP would request a postponement, on the back foot.

He has also launched a frontal attack on Mr Musharraf, saying Ms Bhutto had named him responsible for her death in an email she sent to her lobbyist in the US two months ago.

'Unfinished agenda'

Analysts believe that Ms Bhutto's assassination has already mobilised PPP's supporters all over the country, and they are in an aggressive mood.

Conditions are also ripe for the PPP to pick up considerable sympathy votes that would otherwise have remained un-polled or may have gone to other parties.

Meanwhile, the countrywide shutdown effected by the PPP sympathisers has sidelined whatever influence the ruling PML-Q party had in the country.

As such, the PPP leadership would have more time to focus on the "unfinished agenda" of Ms Bhutto, forcing the government to give in to PPP demands for fair elections.

This will require negotiations on several fronts, such as the use of official resources by PML-Q candidates and pressure tactics employed by the intelligence agencies to manipulate elections.

In the post-election period, there are questions about presidential powers as opposed to powers of the prime minister, and other constitutional "aberrations" which Ms Bhutto had been pressuring the government to straighten out.