Blast in Pakistani city of Peshawar, 5 dead

PESHAWAR, Pakistan (Reuters) - A suicide bomber killed five people in the Pakistani city of Peshawar on Thursday when he set off his explosives at a checkpost on a busy road in the heart of the city, police said.

Peshawar has seen a surge of militant strikes since the army went on the offensive against Pakistani Taliban militants in their South Waziristan stronghold on the Afghan border in October.

"The bomber was on foot and detonated explosives strapped to his body during a body-search at the checkpost," Karim Khan, senior police officer at the scene, told Reuters.

The checkpost is on the city's Mall Road, near offices of the national airline and some media companies. It is also close to a Christian girls' school and the city's military district.

Top city official Sahibzada Anis told Reuters five people, including one policeman, were killed and 25 were wounded. The bomber had apparently been heading toward a market, he said.

The blast sparked panic in offices and shops along the road, residents said.

Peshawar is the gateway to the Khyber Pass and an ancient trading hub between South Asia's plains and the mountains of Afghanistan.

During the 1980s, the city was also a hub for Islamist fighters, including Osama bin Laden, battling Soviet occupiers in nearby Afghanistan.

Security is very tight in Peshawar and elsewhere across the country, with police checkposts on roads and guards at the gates of public buildings.

But analysts say it is virtually impossible to stop bombers on foot or in cars who are prepared to blow themselves up when challenged.

Stock investors shrugged off the latest blast and the main index ended 1.28 percent up at 9,422.23 a day after the International Monetary Fund approved a fourth tranche, worth $1.2 billion, of a $11.3 billion standby arrangement.

POLITICAL TENSION

Police have stepped up already tight security in the run-up to Ashura, the Shi'ite Muslim mourning ritual, early next week.

Sunni Muslim militants have in the past attacked their Shi'ite rivals as they hold processions on the streets.

Deteriorating security has coincided with rising political troubles for President Asif Ali Zardari and his government.

Zardari, widower of assassinated former prime minister Benzair Bhutto, has been facing calls to step down since last week when the Supreme Court threw out an amnesty that had protected him, several aides and government ministers and thousands of others from corruption charges.

The unpopular Zardari, close to the United States, has rejected the calls to quit. He and his party also said no ministers would step down in the face of a "witch-hunt."

Zardari has been dogged by accusations of graft from the 1990s when Bhutto served two terms as prime minister. He says the charges were politically motivated.

The political and security problems come as the United States has stepped up pressure on its nuclear-armed ally to clear out Afghan Taliban along the border from where they launch attacks on U.S.-led forces in Afghanistan.

Pakistan has rejected the calls, saying it can not open too many fronts at the same time.

(Additional reporting by Izaz Shams, Zeeshan Haider and Kamran Haider; Writing by Robert Birsel; Editing by Ron Popeski)