By Mark Duff BBC News, Milan

President Napolitano holds Romano Prodi's political future in his hands

Italy's President Giorgio Napolitano is beginning talks on who should form a new government, following the resignation of Prime Minister Romano Prodi.

Mr Prodi tendered his resignation after his centre-left coalition suffered a damaging parliamentary defeat.

Mr Napolitano is now expected to hold a round of meetings at which he will test the level of support for a new Prodi government.

After the high drama of Wednesday's Senate vote, which saw the government defeated on its foreign policy, the smart money is on a much-weakened Mr Prodi being offered a new mandate to govern.

Failing that, the president may feel obliged to construct a temporary government of technocrats to hold the fort - and push through urgent measures like pensions reform and the next year's budget.

However, the consensus among political pundits seems to be that, in the short term at least, Italy is more likely to see a second, weaker, Prodi government than any return to a centre-right government, or swift elections.

Political irony

In the longer term, some political pundits are suggesting that Mr Prodi, himself a committed Catholic, may be tempted to recruit some moderate Catholic elements from the centre-right coalition led by the former prime minister, Silvio Berlusconi.

This recasting of the political landscape would rid him of the need to rely on the hard-line, unreformed Communists who have proved so troublesome in his government, experts say.

The irony of all this will not be lost on Mr Napolitano.

A former Communist himself, he now finds himself picking up the pieces left by the refusal of some of his former fellow-believers to accept the deployment of Italian troops to Afghanistan, and the expansion of a big US military base in Vicenza, northern Italy.

Deaf ears

Italy has never punched its weight on the international stage, so Mr Prodi could be forgiven for having thought that foreign policy was a safe playground for his feistier left-wing partners.

Romano Prodi has been reminded of the power of piazza politics

He will not make that mistake again.

What has happened over the past couple of weeks is a reminder of the power of the piazza in Italy - the ability of popular protest to change the political landscape.

Last weekend's huge demonstrations in Vicenza against the expansion of the US base there underlined the scale of Mr Prodi's miscalculation.

His foreign minister Massimo D'Alema, himself a former Communist and viewed by some as one of the shrewdest political operators in the land, had warned that the government would have to resign if it lost Wednesday's vote. The warnings fell on deaf ears.

Mr Prodi may survive for the time being, if given a new mandate to lead after a re-jig of his government team.