By Margarita Antidze YEREVAN, May 12 (Reuters) - Armenia votes in a parliamentaryelection on Saturday that is seen as a test of democracy in theCaucasian country and a dress rehearsal for a presidentialcontest next year. The Republican party led by Prime Minister Serzh Sarksyan --a trusted lieutenant and favoured successor to President RobertKocharyan -- is expected to easily defeat the opposition when2.3 million voters in ex-Soviet Armenia go to the polls. "If the Republican party gets enough votes in the ...election and my party puts forward my candidacy for thepresidential election, I will take this offer with pleasure,"Sarksyan told Reuters in an interview on Thursday. Kocharyan is to step down early next year when his secondterm ends, triggering a presidential election. Western monitors said Armenia's last parliamentary poll fellshort of democratic standards, and the opposition has threatenedstreet protests if there is ballot fraud on Saturday. Armenia nestles high in the mountains of a region that isemerging as a vital transit route for oil exports from theCaspian Sea to energy-hungry world markets, though it has nopipelines of its own. Armenia fought a still-unresolved war with neighbouringAzerbaijan in the early 1990s. It also has fraught relationswith Turkey, in part because Ankara will not recognise asgenocide the killing of Armenians in Ottoman Turkey. Armenia refused entry visas to eight Turkish nationals whowere to be part of a 400-strong election observer mission fromthe Organisation for Security and Cooperation in Europe (OSCE). OPPOSITION DIVIDED Voters on Saturday are expected to credit Kocharyan's alliesfor the years of strong economic growth he has overseen. Theopposition meanwhile is divided and its members say they are notgiven fair treatment on tightly controlled television. Opposition leaders have said they will stage street protestsif there are any electoral violations on Saturday. "If there is ballot fraud in parliamentary election, I'll bethe first who will go to the street," said Artur Baghdasaryan,leader of opposition party Orinats Yerkir (Country of Laws),which is seen by analysts as the strongest opposition force. Smaller opposition groups may also win seats, althoughopinion polls suggest the chief challenger to the Republicanparty is the pro-presidential Prosperous Armenia, set up bywealthy businessman Gagik Tsarukyan. International observers say Armenia should hold fairelections to amend its image spoiled by the last parliamentaryelection, in 2003, which was described by Western monitors asfalling short of democratic standards. "Armenian authorities have made a number of changes to theelection code and to the whole process to tackle some of theserious problems that came up last time," Urdur Gunnarsdottir, aspokesperson for the OSCE/ODIHR monitoring group, told Reuters. "The real test is on election day and during counting. It'simportant for Armenia to show that authorities are capable ofholding democratic election. That is a corner stone." Simmering tensions burst to the surface last month whengunmen tried to kill a senior member of Sarksyan's party and twoblasts ripped through the offices of Prosperous Armenia. The violence has revived memories of a 1999 shootout inparliament that killed the speaker and the prime minister. (Additional reporting by Hasmik Mkrtchyan)