* PM expected to ask president to announce snap election
* Election should not slow Serbia's EU bid - PM
By Aleksandar Vasovic
BELGRADE, Jan 25 (Reuters) - The leadership of Serbia's dominant Serbian Progressive Party (SNS) agreed on Sunday to seek an early parliamentary election, aiming to capitalise on a surge in popularity to cement its grip on power and push through economic reforms.
After a meeting in Belgrade, SNS leader and Deputy Prime Minister Aleksandar Vucic told reporters the party's presidency had endorsed his proposal.
"Our bid is based on the fact that Serbia could do faster, more and better and that changes cannot wait," he said.
The SNS, the largest party in the ruling coalition, wants an even stronger mandate to help speed up reforms it says are essential to Serbia's recovery from a decade of war and isolation in the 1990s.
Tension within the coalition over the pace and depth of reform saw Economy Minister Sasa Radulovic, a non-party member of the cabinet, resign on Saturday due to resistance from unions and some in government to measures aimed at liberalising the labour market and cutting loose dozens of loss-making state firms.
The Balkan country must also speed up reforms to make a precautionary loan deal with the International Monetary Fund in talks set to begin on Feb. 26.
The SNS is riding high in opinion polls, mainly due to Vucic's popularity and an anti-graft campaign he has been waging. An SNS election victory would almost certainly see him as prime minister and could force the Socialists of Prime Minister Ivica Dacic into opposition.
The state-run RTS TV reported that Dacic is expected to convene his cabinet on Monday and propose to the president he dismiss government and schedule elections for March 16, to coincide with the municipal vote in the capital Belgrade.
On Saturday, Dacic said the election should not be an obstacle for Serbia's bid to join the European Union. "Serbia's strategy is based on reforms, better living standards for its people and EU membership," he said in a statement.
The EU opened accession talks with Serbia on Jan. 21, a process that should help drive change in the largest country to emerge from the former federal Yugoslavia. Serbia is unlikely to join before 2020.
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