Mr Vajpayee's term of office was scheduled to end in October
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Indian President Abdul Kalam has dissolved the lower house of parliament ahead of general elections expected in April.
India's governing coalition has called early polls to capitalise on what it perceives are key political and economic gains.
Prime Minister Atal Behari Vajpayee's term of office was scheduled to end in October.
The independent Election Commission will announce the dates of the polls next week.
For logistical and security reasons the vote itself takes several weeks to complete.
Re-election bid
India's lower house has 545 members elected to serve for five years.
The BJP, the main party in the ruling coalition, believes it has a number of elements in its favour for an early election.
These include a buoyant economy as well as a string of recent election successes in three politically influential states.
A recent visit to Pakistan and an agreement for talks on the disputed region of Kashmir have also boosted Mr Vajpayee.