By Amy Sawitta Lefevre and Martin Petty
BANGKOK (Reuters) - Thai Prime Minister Yingluck Shinawatra dissolved parliament on Monday and called a snap election, but anti-government protest leaders pressed ahead with mass demonstrations in Bangkok seeking to install an unelected body to run the country.
Police estimated about 160,000 protesters converged on Yingluck's office at Government House, but there was none of the violence and bloodshed seen before the demonstrations paused last Thursday out of respect for the king's birthday.
The protesters want to oust Yingluck and eradicate the influence of her brother, former premier Thaksin Shinawatra, who was toppled by the military in 2006 and has chosen to live in exile rather than serve a jail term for graft.
There was a carnival atmosphere as protesters gathered at Government House, with unarmed police and troops inside the gates. The demonstrators made no attempt to get into the grounds but said they would camp outside overnight.
After nightfall, protest leader Suthep Thaugsuban made a speech to his supporters. "From this minute onwards, all Thais have taken power back for the people," he said.
He called Yingluck's government incompetent and corrupt for policies such as a costly rice intervention scheme and water management projects, and he said the people would select a new prime minister. But he gave no clues as to how that would be done, or how he planned to take over the levers of power.
Aware that the allies of Yingluck and Thaksin would almost certainly win any election, Suthep has called for a "people's council" of appointed "good people" to replace the government.
As such, he was dismissive of the early election. "The dissolving of parliament is not our aim," he told Reuters.
Opposition Democrat Party lawmakers resigned en masse from parliament on Sunday, saying they could not work with Yingluck.
Democrat leader Abhisit Vejjajiva sidestepped a question on whether his party would take part in the election.
"House dissolution is the first step towards solving the problem," Abhisit, a former prime minister, told Reuters as he marched with thousands of flag-waving protesters in Bangkok's central business district. "Today, we march. I will walk with the people to Government House."
An election would not end the deadlock if the main opposition party did not take part, said Pavin Chachavalpongpun of Kyoto University's Centre for Southeast Asian Studies.
"This is only a short-term solution because there is no guarantee that the Democrats will come back and play by the rules," Pavin said. "It seems like Thailand is going nowhere."
In April 2006, amid mass protests, the Democrats refused to contest a snap election called by Thaksin, who was deposed by the military five months later.
Yingluck announced the election in a televised statement.
"At this stage, when there are many people opposed to the government from many groups, the best way is to give back the power to the Thai people and hold an election. So the Thai people will decide," she said.
The government said the vote would be held on February 2.
Suthep's campaign opens up the prospect of a minority of people in Thailand, a country of 66 million and the second-biggest economy in Southeast Asia, dislodging a democratically elected leader, this time without help from the military.
The politically powerful army, which has staged or attempted 18 coups in the past 80 years, has said it does not want to get involved, although it has tried to mediate.
The protests follow nearly a decade of rivalry between forces aligned with the Bangkok-based establishment and those who support Thaksin, a former telecommunications tycoon who won huge support in the countryside with pro-poor policies.
Thaksin fled Thailand in 2008 to avoid the graft conviction but is seen as the power behind his sister's government. The protests were sparked last month by a government bid to introduce an amnesty that would have expunged his conviction.
The pro-establishment Democrat Party has not won an election since 1992. Yingluck's Puea Thai Party won the last election in 2011 by a landslide, enjoying widespread support in the north and northeast, Thailand's poorest regions.
Thailand's first female prime minister will stand again, said Jarupong Ruangsuwan, head of her party. "We want the Democrat Party to take part in elections and not to play street games," he added.
Protester Somchai Kasemporn, 51, a traditional medicine doctor from Bangkok who marched to Government House, dismissed Yingluck as a lame duck.
"The question is: does she even have the legitimacy to dissolve parliament? This is all about a crooked man, Thaksin, who rules for profit and thinks that because he has votes, he is the winner," he said.
Thitinan Pongsudhirak, a political analyst at Chulalongkorn University in Bangkok, was concerned that the Democrats had thrown in their lot with the extra-parliamentary movement and predicted pandemonium if Suthep won the battle.
He also worried about the reaction of the pro-Thaksin "red shirts", whose lengthy 2010 protests against the Abhisit government were put down by the military at the cost of more than 90 lives on both sides.
"When they (the government) unleash the wrath of the red shirts, that could signal dark days ahead for Thailand," Thitinan said.
(Additional reporting by Andrew R.C. Marshall, Apornrath Phoonphongphiphat and Panarat Thepgumpanat; Writing by Jason Szep and Alan Raybould; Editing by Robert Birsel and Nick Macfie)