* Fears of instability in Pakistan's commercial capital
* Tensions between government and Supreme Court
* Potent mix of ethnic and political rivalries, militancy
By Faisal Aziz
KARACHI, Oct 18 (Reuters) - Pakistan's dominant political force in Karachi has stepped up pressure on the government to protect its workers after violence again raised fears of instability in the country's commercial capital.
The Muttahida Qaumi Movement (MQM) threatened to pull out of the coalition government of President Zardari after at least 33 people were killed in weekend attacks that coincided with a by-election to replace a MQM lawmaker murdered in August.
That could lead to the central government losing its majority in the National Assembly, or its downfall if the MQM allied itself with the opposition.
The government already faces an array of problems, including a possible showdown with the judiciary, a Taliban insurgency and the task of rebuilding after summer floods that made more than 10 million homeless and are likely to strain the economy for years.
MQM has made similar threats before but the latest bloodshed has increased the chances of that happening, party sources say. Several party workers were killed, the MQM said.
<^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^
For more Pakistan stories click [ID:nAFPAK]
or see http://link.reuters.com/kac58m
For a factbox on Karachi [nSGE69G01J]
Pakistan blog: http://blogs.reuters.com/pakistan/
^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^>
"We are under immense pressure from our workers and voters to take some action," said a senior MQM leader.
"We cannot tolerate the continued killings of our workers and are increasingly unable to justify our presence in a government which has failed to protect us."
SUPREME COURT PRESSURE
Speculation has swirled for weeks that Pakistan's Supreme Court would uphold the scrapping of an amnesty law, possibly opening the door to attempts to prosecute government leaders, including Zardari.
It allowed some current politicians including Zardari to return after years of exile. It was thrown out in December 2009 by the Supreme Court, which must now pronounce on a government attempt to overturn that ruling.
A combustible mix of political and ethnic rivalries, sometimes linked to criminal gangs, and militancy makes Karachi prone to violence.
Stock market investors keep a wary eye on tension in Karachi, home to Pakistan's main port, stock exchange and central bank and the main gateway for Western military supplies bound for neighbouring landlocked Afghanistan.
The MQM blamed its rival ethnic Pashtun-based Awami National Party (ANP) for the weekend killings, an allegation it denied.
It has repeatedly said that the provincial government, dominated by Zardari's Pakistan People's Party, had failed to stop the violence in the sprawling city of 18 million people.
Unofficial results showed the MQM sweeping Sunday's election for a provincial seat to replace lawmaker Raza Haider, whose shooting triggered violence which killed 100 people in a week.
The MQM's Ishrat-ul-Ibad, governor of the Sindh province, met Zardari late on Sunday night to offer his resignation but kept the decision "on hold" after getting assurances the government will move swiftly to control violence, said a party official. (Editing by Michael Georgy and Alex Richardson) (For more Reuters coverage of Pakistan, see: http://www.reuters.com/places/pakistan)
Our Standards: The Thomson Reuters Trust Principles.
