NEW DELHI (Reuters) - India's Prime Minister Narendra Modi will replace his defence minister, a senior party official told Reuters on Thursday, in a move that would allow the minister, Arun Jaitley, to focus on his main job of steering the economy out of troubled waters.

Since Modi took office in May, Jaitley has headed both ministries.

He will be replaced by Manohar Parrikar, the chief minister of Goa, said Sadanand Tanavada, a general secretary of the state unit of the Bharatiya Janata Party.