By Augustine Anthony
ISLAMABAD (Reuters) - Asif Ali Zardari, the widower offormer Pakistani prime minister Benazir Bhutto, swept tovictory in a presidential election on Saturday.
Underscoring the problems he faces, a suicide car bomberkilled 16 people in an attack on a police post in thenorthwestern city of Peshawar. At least five of the dead werepolicemen, and the blast wounded about 40 people.
Investors and foreign allies led by the United States hopethe election will bring some stability after months ofpolitical turmoil and rising militant violence. The uncertaintyhas dragged stocks and the rupee sharply lower.
Members of the two-chamber parliament and four provincialassemblies voted on a replacement for deeply unpopular PervezMusharraf, who resigned last month.
Zardari, who had been widely expected to win, secured 480out of 702 electoral college votes, according to unofficialElection Commission results.
"It's not only a victory for Mr Zardari and the PakistanPeople's Party but it's a victory for ... Benazir Bhutto'sdream of a democratic political system," said Bhutto partyspokeswoman Farzana Raja as party workers chanted "long liveBhutto".
Bhutto was killed in a suicide attack on December 27 lastyear, weeks after returning from years in exile. Her party nowholds the presidency and leads the government.
Zardari was a polo-playing playboy in his younger days wholater spent years in prison on charges he says were politicallymotivated.
He will have to contend with a host of problems that haveraised fears for prospects for the nuclear-armed U.S. ally,including militant violence and an economy in tatters.
The bomb in Peshawar destroyed the post and brought downroofs of nearby buildings and some people were under therubble, said provincial police chief Malik Naveed Khan. Thebomber's target was probably the provincial assembly wheremembers were voting, he said.
CLOSE TO U.S.
Zardari, 53, was thrust into the centre of politics by hiswife's assassination. A February parliamentary election win fortheir Pakistan People's Party (PPP) made him one of the mostpowerful figures in the country.
His decision in August to begin impeachment proceedingsagainst Musharraf led to the latter's resignation, and clearedthe way for Zardari to win the top job.
His two rivals for president were Saeeduzzaman Siddiqui, aformer judge, nominated by former prime minister Nawaz Sharif'sparty, and Mushahid Hussain Sayed, a senior official of theparty that backed Musharraf and ruled under him.
A former businessman, Zardari is close to the United Statesand has stressed Pakistan's commitment to the widely unpopularcampaign against militancy.
But he will take office as anger with the United States isboiling after a bloody incursion by U.S. ground troops into aremote village on the Afghan border on Wednesday.
In response to the raid, authorities blocked a major fuelsupply route for Western forces in Afghanistan.
"We have told them that we will take action and we havealready taken action today. We have stopped the supply of oiland this will tell how serious we are," Defence MinisterChaudhry Ahmed Mukhtar told Dawn Television.
Most fuel and other supplies for U.S. forces in Afghanistanare trucked through Pakistan, crossing the border at twopoints, Torkham, near Peshawar, and Chaman to the southwest.
The Chaman crossing, where supplies cross into the Afghansouth, was operating normally.
DOUBTS
Zardari spent 11 years in jail on corruption and murdercharges. He was never convicted and denied any wrongdoing.
But in an indication of the doubts he faces, a poll byGallup Pakistan found only 26 percent of about 2,000 peoplequestioned thought he should be president, while 44 percent didnot want any of the three candidates.
Political uncertainty, exacerbated by a split in thePPP-led coalition last month, together with security andeconomic worries, has sapped investor confidence and draggedPakistani stocks down 34 percent this year.
The main index rose 1 percent on Friday, helped by optimismthe vote will bring clarity. The rupee has lost 20 percent tothe dollar this year but firmed on Friday.
Dwindling foreign reserves, a widening current accountdeficit and sliding rupee could prompt a ratings downgrade asdoubts mount over Pakistan's ability to meet external debtobligations.
But it will probably avoid sovereign debt default as itsstability is such an important geopolitical factor institutionswill eventually help, analysts say.
(Additional reporting by Kamran Haider, Zeeshan Haider,Faris Ali, Imtiaz Shah, Gul Yousafzai, Mubasher Bukhari;Writing by Robert Birsel; editing by Keith Weir)
