Medical and rescue efforts at the blast site have been hampered by power blackouts following the explosion.

UN condemnation

Most of those killed were Pakistani but Mian Iftikhar Hussain, the provincial information minister, said two foreigners were among the dead.

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The UN said one of them was Aleksandar Vorkapic from Serbia, an employee of the UNHCR refugee agency who was part of an emergency team recently deployed to Pakistan to tackle help the millions who have been displaced by fighting.

Ban Ki-moon, the UN secretary-general, condemned "in the strongest possible terms today's terrorist attack".

"Once again, a dedicated staff member of the United Nations is among the victims of a heinous terrorist attack which no cause can justify," he said.

Peshawar is the capital of the North West Frontier Province (NWFP) where Pakistani government forces have battled fighters loyal to the Taliban in recent weeks.

Taliban fighters have threatened to stage a series of attacks against civilian and government targets in retaliation for the military offensive in the province.

Inayat Ali Khan, a local journalist, told Al Jazeera that the attack was similar in execution to previous attacks in Peshawar.

"These tactics have been used several times in recent attacks – the terrorists fire shots against the security teams at the checkpoints, and then they enter their vehicle inside," he said.

'Tipped off'

Iqbal Khattaq, the Peshawar bureau chief for Pakistan's Daily Times, told Al Jazeera that Pakistani intelligence agencies and police had been "tipped off" about a possible attack by fighters from the South Waziristan and the Swat region of the NWFP.

Rescue efforts have been hampered by power blackouts following the blast [AFP]
"This building is also quite far away from the main road, so it was [thought to be] hard for bombers to carry out an attack similar to a bombing at a Marriott hotel [in Islamabad] last year.

"American officials and diplomats were often seen at this hotel; we do not know whether any are among the dead and wounded."

The Pakistani military launched its offensive in the NWFP after Taliban fighters moved to within 100km of Islamabad, violating a deal that was to see stricter implementation of Islamic law for the region's three million people in exchange for peace.

More than a dozen bomb attacks have killed at least 100 people across Pakistan since the Pakistani military began its offensive in the NWFP in late April.

Peshawar has seen at least seven bombings in the last month and the capital, Islamabad, has also been hit, with two police officers killed in a suicide bomb blast there on Saturday, the first such attack since the military offensive began in the NWFP.