Bhutto's body flown home, Pakistan in crisis

( Reuters ) - The body of opposition leader Benazir Bhutto arrived in her family village for burial on Friday, hours after her assassination plunged nuclear-armed Pakistan into one of the worst crises in its 60-year history.

Her killing on Thursday after an election rally in the city of Rawalpindi triggered a wave of violence, especially in her native Sindh province.

It stoked fears that a January 8 election meant to return Pakistan to civilian rule could be put off, although caretaker Prime Minister Mohammadmian Soomro said on Friday there was no change in timing for now.

World leaders urged Pakistan not to be deflected from a course toward democracy, as fears of instability in a region racked by Islamist militancy roiled markets on Friday and triggered a flight to less risky assets such as bonds and gold.

"Unrest in Pakistan is eroding the market sentiment dramatically as Pakistan, unlike North Korea or Iran, is known to really have nuclear weapons," said Koichi Ogawa, chief portfolio manager at Daiwa SB Investments.

Thousands of mourners thronged Bhutto's ancestral home as the former prime minister's body arrived aboard a military aircraft, accompanied by husband Asif Ali Zardari and their three children.

People cried and wailed as Bhutto's coffin was taken by ambulance to her family home in Sindh's Larkana district.

"Show patience. Give us courage to bear this loss," Zardari urged mourners as the coffin was borne into the house.

Bhutto, 54, had hoped the huge popular following she enjoyed among the Pakistani poor would propel her to power for the third time in an election intended to stabilize a country struggling to contain Islamist violence.

But as she left the campaign rally, where she had spoken of threats to her life, she stood to wave to supporters from the sun-roof of her bullet-proof vehicle. An attacker fired shots at her before blowing himself up, police and witnesses said.

She was killed by bullets to the head and neck, a security official said, adding: "The shooter was either very well trained or he was very close so he could hit her in the temple and neck."

She was pronounced dead in hospital in Rawalpindi, home of the Pakistan army and the city where her father, former prime minister Zulfikar Ali Bhutto, was hanged in 1979 after being deposed by a military coup.

Across Pakistan, a country used to political violence and ruled by the military for more than half of its life, friends and foes alike were stunned by the death of a woman many had once criticized as a feudal leader buoyed by popular support while enjoying the riches of the family dynasty.

"We've lost a great leader. We hoped she would bring peace to our area but now chances are very slim," said Noor Ahmed Khan, an electrician in violence-plagued North Waziristan on the Afghan border.

Bhutto had spoken out strongly against Islamist violence and had been threatened by pro-Taliban militants.

At least four people were killed on Thursday night in Karachi, capital of Sindh, as news of her death sent thousands of angry supporters pouring into the streets. On Friday unidentified gunmen shot dead a policeman and wounded three.

Hundreds of cars, trucks and buses smoldered in the interior of Sindh province and crowds of men set up road blocks and chanted slogans against President Pervez Musharraf.

Former prime minister Nawaz Sharif, Bhutto's old political rival, said his party would boycott the January election.

He blamed Musharraf, who seized power in a 1999 military coup but recently retired from the army, for creating instability.

Musharraf imposed a state of emergency in November in what was seen as an attempt to stop the judiciary from vetoing his re-election as president. He lifted emergency rule this month.

Authorities ordered the central bank and all schools across Pakistan to close for three days of mourning.

The United States, which relies on Pakistan as an ally against al Qaeda and the Taliban in neighboring Afghanistan, had championed the Harvard- and Oxford-educated Bhutto, seeing in her the best hope of a return to democracy.

"The United States strongly condemns this cowardly act by murderous extremists who are trying to undermine Pakistan's democracy," President George W. Bush said.

Bush telephoned Musharraf and urged Pakistanis to honour Bhutto's memory by continuing with the democratic process and holding elections as scheduled.

Reporters asked Prime Minister Soomro if any decision had been made on postponing the polls in light of Bhutto's death, "Nothing yet," he replied. "Elections stand as they were announced."

But analysts said the assassination, which followed a wave of suicide attacks and the worsening of an Islamist insurgency, could make it impossible to go ahead with the election on time.

Musharraf condemned the attack on Bhutto, in which a total of 16 people were killed, and called for calm.

"We will not sit and rest until we get rid of these terrorists, root them out," he said. He did not mention the poll.

In 1988, aged just 35, Bhutto became the Muslim world's first democratically elected woman prime minister. Deposed in 1990, she was re-elected in 1993, and ousted again in 1996 amid charges of corruption she said were politically motivated.

Along with her husband, she is survived by a son Bilawal, 19, and two daughters, Bakhtawar, 17 and Aseefa, 14.

Bhutto's husband said the government should step down.

"We demand the immediate resignation of the government. Those who were responsible for the attack on October 18 are also responsible for this attack," he told Reuters by telephone.

He did not elaborate but referred to a letter Bhutto wrote to Musharraf before she returned to Pakistan in which she said if she were attacked, some of Musharraf's allies and a security agency would be responsible.

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