A Paraguayan tribal woman who says she was captured in the jungle and sold into forced labour as a child has become a member of the the country's cabinet, vowing to improve the lives of South America's indigenous population.

Margarita Mbywangi, a 46-year-old Ache tribal chief, has been made minister of indigenous affairs, becoming the first indigenous person to oversee ethnic Indian affairs in Paraguay.

She was named in the new cabinet of the leftwing president, Fernando Lugo, who was inaugurated on Friday, ending the 61-year-rule of the conservative Colorado party.

The mother-of-three, who spent the early part of her career as an activist defending her people's land, is now studying for her high school diploma.

She was sold between several families as a child. "When I was a girl, four years old, the whites kidnapped me in the jungle and I was sold several times to families of hacienda owners. They sent me to school, so I can read and write," she told Channel 2 television.

She said her masters told her she was an Indian and began to seek her origins "until I found my people in the community of Chupapou".

The most vocal opposition to Mbywangi's appointment has come from other Indian leaders, who fear she will side with her own people in disputes over land, but she has promised to meet with those who opposed her appointment to ease their concerns.

"We are immediately going to help colleagues from different communities who are experiencing a difficult situation due to lack of potable water, food and clothing," she told the television station.

She said she would begin to work on legalising Indian titles to lands that sometimes have been claimed by outsiders, as well as to conserve the forests.

"For the Indian, the forest is his mother, his life, his present and future," she said.

According to government figures, about 90,000 Paraguayans say they belong to one of the country's 400 Indian communities.