"Zanetti will be the new vice-president of the club, and has signed a two-year contract. The entire board has also agreed to retire his number four jersey," Thohir told reporters after a board meeting.
Thohir also announced he would be offering coach Walter Mazzarri a one-year contract extension that will keep him at the club until 2016.
"We've discussed a year's extension on his contract, so we'll have him for two full years," he said.
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Argentinian Zanetti retired from football at the end of last season after spending 19 years at Inter Milan, during which he won five league titles, scored in a 3-0 1998 UEFA Cup final win over Lazio, and played a key role in the treble-winning 2010 side that produced Inter's first European Cup title in nearly half a century.
In almost two decades at the club Zanetti made 615 Serie A appearances, by far the most of any foreign player in Italy's top flight and second only to Paolo Maldini. He also represented his country 145 times.
The 40-year-old said an emotional farewell to fans after Inter's 4-1 victory over Lazio at the San Siro in May, when he was promised a new role within the club that until Monday had remained unspecified.
Zanetti came on as a 52nd minute substitute during that win, which booked Inter's place in the Europa League for next season.
Inter finished fifth in Serie A after at campaign that saw frequent protests from fans at Mazzarri's management and the running of the club by new owner Thohir, the Indonesian businessman who succeeded long-time owner Massimo Moratti as club president in November.
(Reporting by Terry Daley, editing by Stephen Wood)
