Around a dozen hotel and restaurant workers were arrested after more than 1,000 protesters took to the streets in the tourist area of Thamel, an AFP reporter said.

Other small rallies were staged in the capital and on the main ring road as police shied away from enforcing a ban on all gatherings. Opposition parties who have called an indefinite general strike said the demonstrations were growing.

"Our movement will continue until we achieve our goals. People across the country have shown their support to our ongoing movement," said Yogesh Bhattarai, a spokesman for the Communist Party of Nepal (Unified Marxist Leninist), one of seven major parties leading the action.

The parties ousted when Gyanendra sacked the government and took direct control 14 months ago called a strike on April 6 in a move backed by Maoist rebels.

The protests have since snowballed into daily clashes even though riot police have used tear gas, rubber bullets and baton charges against demonstrators and arrested hundreds of ringleaders.

The government initially tried to prevent large-scale protests by banning public gatherings, calling day and night curfews, cutting mobile phones and rounding up hundreds of political activists.

Under sustained pressure, the king on Thursday called for elections and the royal government has allowed more dissent while restoring services like mobile phones.

But there has been no let up in the strike or protests.

Public transport was unavailable Sunday with inter-city and local bus stands deserted and almost all businesses closed.

Gasoline was scarce and long lines could be seen at the army and police-run pumps, the only ones still open. Prices for vegetables have soared on dwindling supplies.

"Very few trucks supplying food have entered the Kathmandu valley over the past few days," said Binaya Shrestha, planning officer of the Kalimati Fruits and Vegetables Market Development Board which supplies 325 wholesalers in the capital.

Housewife Rajnai Kumar said the price of onions rose to 100 Nepalese rupees (1.38 dollars) a kilogram (2.2 pounds) from 25 rupees two days ago.