BERLIN, March 14 (Reuters) - The government of North Rhine-Westphalia (NRW) looked close to collapse on Wednesday after opposition parties indicated they would vote against the government's budget plans, raising the prospect of new elections in Germany's most populous state.
Snap elections in the western state of 18 million people could cause convulsions in Berlin and possibly further weaken Chancellor Angela Merkel's coalition partner, the Free Democrats (FDP).
In NRW, the minority government of Social Democrats (SPD) and Greens had hoped to win FDP backing for its 2012 budget, but the FDP said its lawmakers would reject plans put to the state assembly on Wednesday.
The regional government has long said it could not rule if it did not get the budget approved.
"If an important law cannot be passed, the voters should decide," said Deputy Premier Sylvia Loehrmann, a Green, on German radio.
The state has had a destabilising influence on national politics in recent years.
In 2010, conservative leader Merkel lost her majority in the Bundesrat upper house of parliament after her Christian Democrat (CDU) ally Juergen Ruettgers was ousted as NRW state premier.
Five years earlier, a humiliating loss for the SPD in the state prompted then-chancellor Gerhard Schroeder to call early national elections, in which Merkel managed to replace him.
Polls show the FDP, who share power with Merkel at the national level, may be ousted from the regional assembly which could weaken the party further in the federal coalition.
FDP leader Philipp Roesler is already in a precarious position due to his party's loss of support among voters and many commentators expect him to be forced out if the party performs badly in state elections this year.
Votes are so far scheduled to take place in northern Schleswig Holstein and the western state of Saarland in coming months.
SPD state premier Hannelore Kraft failed to win sufficient votes in the 2010 vote to secure a parliamentary majority with the Greens.