TOKYO - JAPAN'S unpopular Prime Minister Taro Aso on Saturday reiterated his intention not to call elections for now, while signalling he may not seek a grand coalition with the opposition.

The opposition has been pressing Aso to dissolve parliament immediately for snap polls, seeing a chance finally to unseat his long-dominant Liberal Democratic Party (LDP).

In an interview with Japanese media, however, Mr Aso repeated his plan to pass budgets before calling snap elections, saying: 'It would be irresponsible not to lay the groundwork for economic measures.'

The government must call a general election by September, while Mr Aso's ruling coalition hopes to pass budget bills by the end of March as the world's second largest economy is suffering recession.

Mr Aso also said it would be difficult to form a grand coalition with the main opposition Democratic Party of Japan under the current single-seat constituency system for the lower house.

Asked if he has a plan to propose a grand coalition with the DPJ, Mr Aso said 'We cannot move forward easily without electoral reform.'

Former prime minister Yasuo Fukuda, who stepped down in September, failed in his proposal to form a grand coalition with the DPJ, which controls one of two houses in parliament, together with other opposition parties.

Mr Aso took office little more than three months ago but his popularity has already tumbled to around 20 per cent with voters critical of his handling of the economy and a series of gaffes by the conservative leader.

Mr Aso's LDP has been in power for all but 10 months since 1955. But its popularity has rapidly dwindled - Aso is the third LDP prime minister to take charge in little over two years. -- AFP