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 maneuvering, removes 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.

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