KARACHI (Reuters) -- Pakistan's commercial capital nearly shut down today as religious and political leaders called for a strike to protest against violence after a suicide bomber killed 43 people at a religious procession this week.
The Taliban claimed responsibility for the December 28 attack on a huge crowd of Shi'ite Muslims and threatened more bloodshed.
The prospect of increased violence comes at a delicate time for President Asif Ali Zardari, who faces political heat because corruption charges against some of his aides may be revived.
The pro-American leader has vowed to defeat Taliban and Al-Qaeda but militant groups remain defiant, killing hundreds of people in bombings despite facing major government offensives.
In a sign of growing anxiety over security, the United Nations will withdraw some of its staff from Pakistan because of safety concerns, a UN spokeswoman said on December 31.
Militants have become increasingly brazen in their bid to topple the government and mpose their brand of Islam, including public floggings and executions for anyone who disobeys them.
The Karachi carnage illustrated their growing reach from their bastions on the Afghan border to major cities, including an attack near army headquarters.
Karachi's streets were nearly empty today. The stock exchange, which normally operates on the first day of the year, was closed.
Police have arrested 18 people since riots triggered by the bombing destroyed hundreds of shops, costing Pakistan's biggest city an estimated 30 billion rupees ($356 million) in damages.
Security forces carried out patrols. But residents were taking no chances.
"We are already losing business and can't take the risk of going out today and opening our shops," said Saleem Ahmed, who sells electronics at one of the city's markets.
"If something happens or anyone comes and damages, say, one refrigerator or deep freezer, I will lose more money than what I would have earned the whole day, so I better stay home."
While investors in Pakistan have got used to almost daily attacks in the northwest, violence in Karachi has a much more direct impact on financial markets and investor sentiment.
Analysts fear further attacks here could raise doubts about the prospects of recovery for Pakistan's economy, now in virtual recession as gross domestic product growth in the 2008/09 fiscal year of 2 percent is about the same as population growth.
The United States, frustrated by what it says are inadequate efforts by Pakistan to crush militants who cross the border to attack Western forces in Afghanistan, has stepped up U.S. drone aircraft attacks on suspected militants.
While the attacks have killed high-profile Al-Qaeda and Taliban militants, they have also generated anti-American anger in Pakistan. A drone killed at least three militants traveling in a car in North Waziristan today, security officials said.
"The bodies were burned beyond recognition. We are trying to determine their identity," said one security official.
On December 31, a drone missile killed at least two fighters in the same area, known as a sanctuary for Taliban and Al-Qaeda militants fighting in Pakistan and Afghanistan.
But militants show no signs of caving in. A bomb planted by the Taliban exploded near a vehicle carrying civilians in Bajaur today, regional government official Adalat Khan told Reuters. "It was a remote-controlled device that killed six innocent civilians, including a child," said the official.