The bombing targeted a procession in the town of Hangu in North West Frontier Province (NWFP) to mark Ashura, the holiest day for Shias. Officials reported several blasts.

Abdul Rashid, medical superintendent at the Hangu hospital, said 29 people had been confirmed dead there.

"We have 29 confirmed dead bodies," he told Reuters. "Some of them have bullet wounds. All of them are Shias."

A leader of the Shia procession, Maulana Khurshid Anwar, said a bomb exploded near a stage where he was about to address Shia mourners.

Enraged Shias set shops and a bank on fire and fired shots into the air in the town 200 km west of Islamabad.

Superintendent Mohammad Ayub, of the Hangu police, said four people died in a shootout during a curfew imposed after the bombing -- one policeman, a soldier, and two civilians.

In another incident, unidentified gunmen opened fire on a bus outside the town, killing four passengers, including a woman, and injuring two, said a paramilitary commander, Aziz Rehman.

NWFP police chief Riffat Pasha said the bombing was a suicide attack and troops were sent to help restore order. Security forces put up barricades on roads leading to Hangu.

"We have sent armoured personnel carriers there, and the Frontier Constabulary is also there," Pasha told Reuters. "The situation is pretty much under control."

Interior Minister Aftab Ahmed Khan Sherpao said there had been three blasts and it could have been a suicide attack or caused by time bombs.

Pakistan has suffered Islamist sectarian violence for years, most of it directed by majority Sunni Muslims against Shias.

Hangu Mayor Ghani-ur-Rehman said he did not believe this traditional rivalry was responsible. "I think it is not a Shia-Sunni affair -- it is terrorism," he said, adding that there were also Sunnis in the procession, including himself.

"I don't believe Sunnis of Hangu would attack the Shias."

Thousands have died in violence between Sunnis and Shias since the 1980s.

But analysts say that in recent years attacks by Sunni groups linked to al-Qaeda have appeared to have had a broader aim of destabilising the rule of President Pervez Musharraf and his alliance with Washington in the US-led war on terrorism.

In neighbouring Afghanistan, at least five people were killed and 27 wounded when clashes broke out between Shias and Sunnis during the Ashura commemoration in the western town of Herat.

Ashura marks the martyrdom of Imam Hussain, a grandson of the Prophet Mohammad. Tensions tend to rise during the month of Moharram, the 10-day period ending with Ashura.