Japan should turn itself into an environment-friendly 'low-carbon society' which would set a precedent in the world, he said at the opening of the 150-day session of parliament.

He added that his government would select 10 cities to be models for low-carbon living and pledged, without divulging figures, to assist developing countries fight global warming.

'In the mid and long terms, however, we must develop revolutionary technology that would ultimately bring emissions of greenhouse gases to zero,' he said.

Japan is home of the landmark Kyoto Protocol but is struggling to meet its own obligations.

Mr Fukuda's remarks come amid press reports that he will next week shift policy and embrace specific goals to cut carbon emissions after Kyoto's requirements expire in 2012.

Japan is eager to show that it is taking the lead in the fight against global warming before it hosts the annual summit of the Group of Eight (G-8) major industrial nations in July.

'It is indispensable to enhance our country's diplomatic power,' he said, 'as the world faces global warming, poverty and other difficult tasks as well as security issues including the fight against terrorism.'

Mr Fukuda also said yesterday that he would work for a new law allowing the Cabinet to dispatch troops at its discretion, avoiding the need to seek parliamentary approval for each mission.

'I will consider a so-called regular law that would enable us to carry out international peacekeeping operations promptly and effectively,' Mr Fukuda said.

But such a proposal is expected to face stiff resistance from many members of the opposition.

The ruling Liberal Democratic Party (LDP) last week used its two-thirds majority in the more powerful Lower House to override the Upper House's rejection of a Bill to restart the mission that refuels US and other ships patrolling the Indian Ocean.

It was the first such override since the LDP was founded in 1955. And the process is time-consuming and using the measure too often could spark a public backlash against the LDP.

Mr Fukuda, a 71-year-old political veteran, took office in September after his embattled predecessor Shinzo Abe abruptly resigned following the loss of the Upper House in elections.

Having forced through a law last week to resume the refuelling mission, Mr Fukuda now faces the challenge of dealing with issues closer to home, including a row over fuel taxes.

The main opposition Democratic Party of Japan (DPJ) wants to cut the petrol tax to win support from voters complaining about soaring oil prices.

The LDP plans to retain the tax to help fund public works such as road repairs in financially strapped regions, and has launched a public relations campaign arguing that the tax is important for the environment.

He said he will form a new consumer protection agency that will help the government coordinate its response to health and food violations following several cases last year.

The move is aimed at winning back voters who were also unhappy with the government's poor handling of 50 million faulty pension records.

Mr Fukuda yesterday reiterated a pledge to match all the pension records with their owners.

AGENCE FRANCE-PRESSE, REUTERS, BLOOMBERG