TOKYO - Japanese political veteran Ichiro Ozawa and dozens of other members of parliament who quit the ruling party over a tax hike plan will launch a new party on Wednesday in a bid to challenge the government, possibly heralding an era of political shakeup.
The exit of Ozawa, a 70-year-old whose political clout is waning after four decades of manoeuvring, removed a key obstacle to Prime Minister Yoshihiko Noda's efforts to control his Democratic Party of Japan (DPJ) and forge coherent policies.
But the unpopular Noda, who depends on support from opposition parties to pass bills in a split parliament, remains vulnerable to an early election if further defections shrink the DPJ's already slim majority in parliament.
The next lower house election must be held by September 2013 and the possible proliferation of smaller parties will also make coalition politics a necessity.
"Ozawa's departure is a plus for Noda in terms of his policy management because it removes sources of friction and makes it easy to cooperate with main opposition parties," said Atsuo Ito, an independent political analyst who has worked for both the Democrats and rival Liberal Democratic Party (LDP).
"But in terms of numbers, Noda's government is weakening."
Many analysts expect no one party will win a majority in the next lower house election, underlining voters' disgust at the inability of mainstream parties to tackle persistent problems such as a stagnant economy and a shrinking, ageing population.
"If an election is called, it may spur a political realignment. Neither the Democrats nor the main opposition could win a majority. It would be a matter of who is allying with whom," said a lawmaker close to Noda.