Pakistan has named Lieutenant-General Raheel Sharif as its new army chief, replacing the retiring General Ashfaq Kayani.

The head of the 600,000-strong army is widely regarded as the most powerful man in the nuclear-armed nation, which has seen three periods of military rule and where the armed forces still exert great influence.

"The prime minister has chosen Sharif as the new army chief and the president has signed off on it," a Defence Ministry official told the Reuters news agency on Wednesday.

An official statement was expected later in the day.

Sharif, whose older brother won Pakistan's highest military award for valour in the 1971 war with India, will formally take command on Thursday.

He comes to the top job as the country faces a daunting array of challenges, including a homegrown Taliban insurgency that has claimed thousands of lives.

The departing commander, Kayani, served as army chief since 2007 and earned credit for resisting the temptation to meddle overtly in politics.