Pakistan PM escapes assassination attempt

Pakistan's prime minister survived an apparent assassination attempt today when at least two shots hit his limousine as he drove toward the capital.

Shots were fired at Pakistani Prime Minister Yousaf Raza Gilani's motorcade near Islamabad's airport today but officials and police said he was not in it at the time.

The attack is bound to compound the fears of investors and allies, who have been worrying about chronic political instability and Islamist militant violence in the nuclear-armed country.

Senior police official Rao Mohammad Iqbal said the motorcade was on its way to the airport to pick Gilani up at the time of the attack.

"The car was going towards the airport when it was fired upon from a small hill ... two bullets hit the driver's window," Iqbal said.

Earlier, the prime minister's spokesman, Zahid Bashir, said shots were fired at Gilani's motorcade but he was not hurt.

"Multiple shots were fired at the prime minister's motorcade. The prime minister is safe, by the grace of God," Bashir said.

The prime minister's office said multiple sniper shots had been fired and television pictures showed two bullet marks a couple of inches apart on the cracked bullet-proof window.

Gilani is a senior member of former prime minister Benazir Bhutto's party. She was killed in a suicide gun and bomb attack on 27 December while campaigning for a general election. The government said al Qaeda-linked militants killed her.

Bhutto's party went on to win the 18 February election and Gilani became prime minister of a coalition government.

Suspicion for the attack will fall on Pakistani Taliban and their al Qaeda allies, who have unleashed a wave of bomb attacks, including some on political leaders such as Bhutto, over the past year. Hundreds of people have been killed.

Former president Pervez Musharraf, who resigned last month, narrowly survived two bomb attacks blamed on al Qaeda.

Bhutto's widower, Asif Ali Zardari, who now leads her party and is expected to win a presidential election on Saturday, last week moved from his home in Islamabad into the heavily guarded prime minister's house because of security fears.

Pakistan's financial markets were closed when news of the attack broke but it is likely to put more pressure on a sliding rupee and stocks.

Economic woes, border attack

Political uncertainty, security worries and a sagging economy have sapped investor confidence since late last year.

The rupee, which has lost more than 20 per cent against the dollar this year, traded at a record low of 77.45 to the dollar today. The main stock index, which is being propped up by a floor placed on the index last week, ended almost flat.

Pakistan's stock market, which rose for six consecutive years from 2002, and was one of the top performers in Asia during that period, has skidded about 41 per cent since its lifetime high in April and 34 per cent this year.

Rising food and fuel prices have driven inflation up to nearly 25 per cent, while trade and fiscal deficits are widening.

While the government has come in for criticism for not focusing on economic problems, it is also under pressure from the United States and other Western countries with troops in Afghanistan to tackle Taliban in border sanctuaries.

The United States says al Qaeda and Taliban militants are based in Pakistan's ethnic Pashtun tribal areas on the Afghan border, where they orchestrate attacks in Afghanistan and Pakistan and plot violence in the West.

Earlier today, suspected US commandos from Afghanistan backed by helicopter gunships carried out an attack inside Pakistan, killing 20 people, including women and children, officials said.

The attack in a border village in the South Waziristan region sparked uproar in Pakistan where a senior official said it was an attack on the country's sovereignty.

It is outrageous," Owais Ahmed Ghani, governor of North West Frontier province, said in a statement.

This is a direct assault on the sovereignty of Pakistan and the people of Pakistan expect that the armed forces ... would rise to defend the sovereignty of the country," he said.

A spokeswoman for Afghanistan's NATO-led force said she had no information about the incident. A spokesman for a separate US-led coalition force declined to comment, referring questions to the US Central Command.