Egypt's army chief, who has made no secret of his intention to stand for president despite not yet announcing his candidacy, remains defence minister in a new cabinet sworn in Saturday.

Field Marshal Abdel Fattah al-Sisi retains the defence portfolio in the new line-up led by Ibrahim Mahlab, a former member of ousted strongman Hosni Mubarak's ruling party.

The cabinet, which is tasked with organising the presidential election, is expected to work in Sisi's favour, after the previous government faced mounting criticism for failing to tackle a floundering economy and worsening industrial unrest.

A majority of the 31-member cabinet also served in the previous administration led by Hazem al-Beblawi.

Sisi, who has emerged as Egypt's most popular political figure since leading the ouster of Islamist president Mohamed Morsi last July, has not officially announced his presidential candidacy.

But his aides say he has already decided to stand in the election scheduled for the spring. In order to do so, Sisi must first step down as defence minister and army chief.

One of his aides told AFP this week Sisi is expected to stay on as defence minister until an electoral law has been passed.

The new government led by Mahlab, a former member of Mubarak's National Democratic Party, faces a host of challenges including huge security problems and economic woes.

The forthcoming presidential election is seen as a major step in a roadmap outlined by the interim military-installed authorities after Morsi's ouster.

Morsi, Egypt's first democratically elected and civilian president, was removed after mass protests against his year-long rule which was marred by allegations of power grabbing and making an already dilapidated economy even worse.

Analysts say the formation of a new government by Mahlab, who was also a member of the upper house of parliament in 2010 during Mubarak's presidency, is likely to work in Sisi's favour as he would like to stand with a government that has a good record.

- Investors, tourists scared off -

Since July, Egypt has been battling deadly street violence and militant attacks that have scared off foreign investors and tourists alike.

Beblawi's government, installed after Morsi's ouster, had become increasingly unpopular despite announcing two economic stimulus packages aimed at kick-starting the economy with funds provided by friendly Gulf Arab states.

Many Egyptians, weary of the three years of turmoil since the 2011 toppling of Mubarak, view Sisi as a strong hand who can restore stability.

Mahlab, a former construction boss who headed the state-owned Arab Contractors Company, one of the Middle East's leading construction conglomerates, and was also housing minister in Beblawi's government, has vowed to fight "terrorism" and revive tourism.

Since Morsi's overthrow, Islamist militants have killed several foreign tourists and many security personnel in attacks that have severely dented the economically vital tourism sector.

Scores of policemen, including some senior officers, have been killed inside and outside the restive Sinai Peninsula where troops are battling growing militancy.

Interior Minister Mohamed Ibrahim, who heads the police, also retained his post in the new government.

Egypt has been further polarised following a brutal government crackdown targeting Morsi and his Islamist Muslim Brotherhood movement.

Amnesty International says more than 1,400 people, mostly Morsi supporters, have been killed in street clashes since last July.

Morsi himself and several senior Muslim Brotherhood leaders have been put on trial in the crackdown.

On Saturday, Morsi and other co-defendants were in court accused of inciting the killings of opposition protesters while he was in office. The judges postponed the trial until Sunday.

Morsi and others are also on trial for breaking out of jail during the 2011 uprising against Mubarak, and for conspiring with foreign powers and movements to destabilise Egypt.

Morsi also faces a fourth trial for allegedly insulting the judiciary.

On Saturday, the authorities arrested his son Abdullah, 19, accusing him of possessing hashish cigarettes, security officials said.

Another son, Osama, a lawyer, dismissed the charge as a fabrication, calling it an attempt "to defame" the Morsi family.