I would prefer Yuvraj to Kaif in the Indian test lineup, and easily so in the ODI team. His two centuries were scored in difficult conditions against some pretty decent bowling attacks, both his 112 and 122 have come in low team totals (287 and 265) which shows how difficult it was to face that attack and score runs, even though Pakistan in both games were able to post big totals.
ODI team is obvious, Yuvraj is one of the best in world cricket in that form.
In tests, its really a pick 'em.
This knock by Kaif is IMO better than anything Yuvraj has produced at test level.
http://www.cricinfo.com/db/ARCHIVE/2005-06/ENG_IN_IND/SCORECARDS/ENG_IND_T1_01-05MAR2006.html
Ironically, it resulted in him being dropped the next game.
He also hit two half-centuries against Australia in 2004 which were back to the wall knocks.
Don't get me wrong, Yuvraj has hit some good knocks too. That being said, I don't rate his 122 vs. Pak in 2006
that highly. The pitch had flattened out immensely, and it was some Shoaib and Asif magic (and just ordinary batting) that resulted in India capitulating. It was still a good counter-attacking knock, but when Ganguly and Dhoni fell, he just played hit shots in what was a lost cause.
His 112 vs. Pak in 2004 was class on a greentop. He also hit a couple of excellent 70s vs. Sri Lanka in 2005, and he's obviously part of the future of the Indian test batting line-up, but I think my overall point is its harsh to deem Kaif as not test class, yet say Yuvraj is, when his record is not that much better, and he hasn't been screwed by the selectors like Kaif has been.
Also, picking between Kaif and Yuvraj depends a lot on team composition. Having Yuvraj and Dhoni at 6 & 7 can be awesome when the top 4 have done their job, and they have liberty to attack. However if India are 98-4, its perhaps not quite Yuvraj's domain just yet.
I can understand why Yuvraj would be selected ahead of Kaif at this moment. Not only have his ODI excellence in recent times been a reason, but with Jaffer, Dravid, Tendulkar, Laxman and now even Ganguly becoming grafters rather than the stroke-makers they used to be (talking about Tendulkar, Laxman and Ganguly here), then Yuvraj fits the team composition nicely. I'd like him to improve his record in the next 12-24 months though.
I'm a fan of both anyway, just don't think its fair to write off Kaif just yet.