Musharraf's rivals head for big win

ISLAMABAD (Reuters) - Pakistani President PervezMusharraf's opponents headed for a big election victory onTuesday after voters rejected his former ruling party, raisingquestions about the future of the U.S. ally who has ruled since1999.

No party is expected to win a majority in the 342-seatparliament but the opposition parties of assassinated formerprime minister Benazir Bhutto and former prime minister NawazSharif appeared to have won enough to command a majority,according to unofficial results.

But there was no confirmation from the parties, which havebeen fierce rivals in the past, that they would form acoalition.

At 7:20 a.m. British time, according to unofficial resultsfrom 241 seats, the PPP had won 80 and Sharif's Pakistan MuslimLeague (Nawaz) had 64. The pro-Musharraf Pakistan Muslim League(PML) trailed with 37. Small parties and independents sharedthe others.

Full unofficial results are due later on Tuesday.

Pakistan's main stock market welcomed the peaceful pollsand absence of rigging complaints, and shares rose more than 2percent by midday. But dealers said the formation of aparliament hostile to Musharraf would make investors nervous.

Monday's vote was postponed from January 8 after Bhutto wasassassinated in a suicide attack on December 27, which raisedconcern about the nuclear-armed country's stability.

As president, former army chief Musharraf did not contestthe elections, aimed at completing a transition to civilianrule, but the outcome could seal his fate.

A hostile parliament could try to remove Musharraf, whotook power as a general in a 1999 coup and emerged as a crucialU.S. ally in a "war on terror" that most Pakistanis think isWashington's, not theirs.

Analysts said the implications for a president whosepopularity slumped after he imposed emergency rule and purgedthe judiciary last year were ominous.

"It's the moment of truth for the president," said AbbasNasir, editor of the Dawn newspaper. "There will be thoughtsswirling in his mind, whether he can forge a workingrelationship with two parties whose leadership he kept out ofthe country."

Bhutto spent eight years in self-exile to avoid corruptioncharges she denied. Sharif was exiled a year after Musharrafousted him in 1999. Both returned late last year.

Sharif was barred from the election because of pastcriminal convictions he says were politically motivated.

The election was relatively peaceful after a bloodycampaign and opposition fears of rampant rigging by Musharraf'ssupporters proved unfounded.

COALITION QUESTIONS

Bhutto's Pakistan People's Party (PPP) had been expected toreap a sympathy vote, while Sharif's party is doingsurprisingly well despite a mixed record as prime minister,when he clashed with the judiciary. His defiance of old foeMusharraf and support for the judges he purged had paid off,analysts said.

Seventy seats are reserved for women and religiousminorities and allocated according to how many seats partieswin. The total for the two opposition parties, with thoseallocations, looked set to be a majority.

Analysts say Musharraf wants a coalition between the PPPand the PML.

A victory for Sharif, who has repeatedly called forMusharraf's removal, or the inclusion of his party in acoalition with the PPP would be disastrous for the president.

He and Bhutto's widower, Asif Ali Zardari, who now leadsher party, vowed before the election to cooperate in the fightfor democracy but made no specific commitment on a coalition.

Neither leader was available for comment on Tuesday.Zardari was due to meet his party leaders later in the day.

Some analysts said the differences between the two partiesmade a coalition doubtful.

"The Sharifs and the core leadership of the PPP agree onalmost nothing ideologically," a Western diplomat said beforethe vote, referring to Nawaz Sharif and his brother, Shahbaz.

Some analysts said the decisive factor in the PML's defeatwas Musharraf's unpopularity and resentment over inflation,food shortages and power cuts.

Groups of happy opposition supporters celebrated in thestreets in cities across the country as results trickled out.

Musharraf has said he would accept the results and workwith whoever won to build democracy in a country that hasalternated between civilian and army rule throughout its60-year history.

Fear appeared to have kept many people from the polls. Anelection watchdog group estimated turnout of 35 percent.

Twenty people were killed in election violence, including,Zardari said, 15 PPP activists.

A secular ethnic Pashtun nationalist party was winning inNorth West Frontier Province, defeating Islamic parties thatwon there in the last elections in 2002.

(To read more about the Pakistan election, double-click on;and visit the Reuters blog "Pakistan: Now or Never?" athttp://blogs.reuters.com/pakistan/)

(Additional reporting by Zeeshan Haider, Faisal Aziz andSahar Ahmed in Karachi; Editing by David Fogarty)