A government statement in New Delhi (Saturday) said establishment of the Nuclear Command Authority - headed by the prime minister - was approved at a meeting of the Cabinet Committee on Security, chaired by Prime Minister Atal Bihari Vajpayee.
It said the authority will consist of an executive council and a political council, which will have sole power to authorize use of nuclear weapons.
The statement reiterated India's pledge not to be the first to use nuclear weapons in a conflict, but said it will retain the option of using the wapons to retaliate for nuclear, chemical or biological attacks on Indian territory or Indian forces.
Both India and Pakistan conducted nuclear tests in 1998, prompting international condemnation and sanctions against both countries that were gradually lifted.
Fears of a possible nuclear conflict between the two Asian neighbors escalated last year to the brink of war over Indian charges that Pakistan was backing militants waging a secessionist struggle in the disputed Himalayan territory of Kashmir.