The United Progressive Alliance coordination committee on Friday night decided to set up a subcommittee on the issue of a separate Telengana state, raising speculation that Telengana Rashtra Samiti president K Chandrasekhar Rao is likely to get a portfolio in the Union Cabinet.

He is now a minister without portfolio.

After a three-hour meeting of the committee, Finance Minister P Chidambaram said that the subcommittee would identify issues to be sorted out before a decision is taken on the issue, which figures in the UPA's common minimum programme.

The meeting, presided over by UPA chairwoman and Congress president Sonia Gandhi, was attended by Prime Minister Manmohan Singh, Defence Minister Pranab Mukherjee, Human Resources Development Minister Arjun Singh, Sharad Pawar (Nationalist Congress Party), Ramvilas Paswan (Lok Janshakti Party), C Rajeshwar Rao (TRS), Mehbooba Mufti (People's Democratic Party) and Lalu Prasad (Rashtriya Janata Dal).

Communist Party of India-Marxist leader Harkishan Singh Surjeet and CPI leader A B Bardhan were also there as special invitees.

Prior to the meeting, Rao met Manmohan Singh. However, he did say what issues he raised.

Chidambaram said the issue of Cabinet expansion did not figure in the meeting.

There is speculation that Jharkhand Mukti Morcha chief Sibu Soren, who also met PM in the evening, is likely to be re-inducted into the Cabinet.

Soren had resigned as coal minister after a Jharkhand court issued an arrest warrant against him in a 20-year-old murder case. He is out on bail now.