Bangladesh's opposition blocked roads, railways and waterways to protest government plans to hold a general election on January 5, the latest turn in a violent political crisis that has paralysed the country.

The opposition, led by former Prime Minister Khaleda Zia, is demanding that the government, led by Prime Minister Sheikh Hasina, resign so that a neutral caretaker administration can oversee the polls.

Hasina denies opposition claims that she might rig the elections if she stays in office.

After the Election Commission announced the election date, the opposition called a 48-hour transport strike starting on Tuesday.

According to police, at least seven people have died since late Monday in violence between opposition activists and government supporters and police.

In all, 37 people have been killed in the last month of protests.

The troubles could lead to economic difficulties for the country.

Norwegian telecom giant Telenor ASA has invested more than $2.5bn in Bangladesh since its subsidiary, the country's largest mobile phone company Grameenphone, started operations in 1997.

Jon Fredrik Baksaas, president and group chief executive of Telenor ASA, said it was worried about injecting more money.

"We are very concerned about the political situation," he said.

He said foreign investment would be hard hit if the situation does not improve.

"If it hits the telecom sector, it (will) also hit other sectors," he said.

Overshadowing advancements

The violence threatens to overshadow some advances Bangladesh has made in recent years, including higher enrolment in primary education, gender parity in primary and secondary education, and reduced child and maternity mortality.

The opposition says it will boycott the election if Hasina does not quit in favour of a caretaker administration without political parties.

A key factor in the dispute is the role of Jamaat-e-Islami, the country's largest Islamic political party.

The party is a Zia ally and was a coalition partner in her government from 2001 to 2006.

Opponents of Jamaat-e-Islami say it is a fundamentalist group with no place in a secular Bangladesh, which broke away from Pakistan in 1971.