Japanese Finance Minister Yoshihiko Noda is emerging as a key candidate to replace Naoto Kan as prime minister and head of the ruling Democratic Party, the Asahi newspaper said on Thursday.

Senior ruling party officials plan to nominate Noda as a candidate for the post in a party election to choose its new leader when Kan steps down and Noda himself is keen to run, the paper said.

The officials hope the choice of Noda, in charge of budget preparations, may smooth passage of bills needed to issue bonds to fund a significant portion of the current fiscal year's state budget, as well as the second extra budget for reconstruction from the devastating earthquake in March, the paper said.

Noda, a fiscal hawk, has called for the need to rein in Japan's huge public debt possibly with tax hikes.

Kan, struggling to contain a nuclear crisis at Tokyo Electric Power Co's crippled Fukushima plant and rebuild Japan's northeast from the devastating March 11 quake and tsunami, last week survived a no-confidence vote by saying he would step down.

He did not say when, though, and rivals in his own party as well as the opposition want him to go soon, clearing the way for a coalition.

Noda has been touted as among possible contenders to replace Kan, alongside Deputy Chief Cabinet Secretary Yoshito Sengoku and former foreign minister Seiji Maehara.