Updated | Italian shooter arrested as two police officers in hospital

A new Italian government has been sworn in at the presidential Quirinal Palace in Rome, as a shooting incident occured outside PM's office.

Democratic Party Deputy Leader (PD), Enrico Letta, was appointed prime minister at the head of a "grand coalition" including Silvio Berlusconi's People of Freedom party (PDL).

The swearing-in signals the end of two months of political deadlock.

Away from the ceremony, outside the PM's office, two paramilitary police officers were injured by gunshots. One was shot in the neck and is reported in serious condition.

The incident was around a kilometre away from the swearing-in ceremony at the Quirinal Palace.

A man identified as Luigi Preiti, a 49-year-old man from the southern region of Calabria who now lives in the northern Piedmont region, has been arrested. Sky reports that the alleged gunman was taken to the hospital. 

The new Interior Minister Angelino Alfano said it appeared the shooting was an "isolated act".

"The tragic and criminal act this morning was carried out by an unemployed 49-year-old man who showed signs of wanting to commit suicide," AFP quoted Alfano as saying.

New justice minister Anna Maria Cancellieri said the attack "has the appearance of being carried out by an unbalanced man" but she did not elaborate on the evidence for that claim.

Until being sworn in today, Cancellieri was the interior minister in charge of state police.

Rome Mayor Gianni Alemanno said: "It's not an act of terrorism but certainly the [political] climate of the past few months has not helped."

Since February's inconclusive poll there has been political stalemate in Italy, which is still plagued by economic woes after becoming one of the first eurozone victims of the global financial crisis of 2008.

The shooting happened about a kilometre (mile) away from the swearing-in ceremony shortly after 11.30am, where, beginning with Letta, the 21 new government ministers stepped forward one by one to receive the oath of office from President Giorgio Napolitano.

Reporters inside the Chigi Palace press office, about half a mile away, heard the shots and raced to the scene.

An AP television producer saw the two wounded Carabinieri officers in the square outside the palace, where one of them lay on the pavement bleeding from his neck.

Between nine and ten bullets were spread out over the square next to the palace, which houses the offices of the premier and other government officials.

Rome Mayor Gianni Alemanno said a third female passerby was also injured in the shooting, but that it is as yet unclear how.

Reports suggest that the shooting led to panic in the square as people tried to flee.

Reports also said that the suspected gunman, dressed in a dark business suit, was immediately grabbed by other police in the square, wrestled to the ground and then taken away.

Sky TG24 TV quoted the man's brother as saying the alleged attacker had lost his job in a construction firm and was upset over marital problems.

An aide to foreign minister Emma Bonino told reporters at the presidential palace that the new Cabinet members were kept briefly inside for security reasons until it was clear there was no immediate danger.

The new interior minister, Angelino Alfano, went to the Rome hospital to visit the policeman who was wounded in the neck.