A Pakistani police officer and a rescue worker examine a damaged school bus at the site of bomb blast in Peshawar, Pakistan on Monday, Dec. 13, 2010. – AP

PESHAWAR: A bomb struck a Pakistani school bus on Monday, killing a mechanic and wounding two children as they were being dropped home after class in the northwestern city of Peshawar, police said.

It was the fifth bombing in Pakistan since last Monday as the country steps up security for the holy month of Muharram, which typically sees a rise in sectarian tensions and attacks on Shia Muslim religious processions.

The explosion ripped through the congested Bhana Marri area on the outskirts of Peshawar.

Police said initially that the bus driver was killed, but later identified the dead man as a mechanic whose workshop was nearby. The driver was among up to four people treated for injuries after the attack.

“My house was nearby and I was standing up to get down when there was a deafening explosion. I saw a fireball and heard the explosion. I didn't know what happened after that,” said nine-year-old Imam Gulzar.

The fourth-grader spoke to AFP at Peshawar's Lady Reading Hospital, where she was being treated for minor injuries.

The windows of the bus from the Islamia Model School - a fee-paying English-language school - were punched out in the blast, the vehicle blackened by fire and a nearby shop damaged in the blast, said an AFP reporter.

Driver Gohar Ali said there were only two girls left on the bus because all the others had already been taken home.

“While I was en route to drop off the last two, there was a blast on my right-hand side. I heard it and then passed out. I don't know what happened after that,” he said.

City police chief Liaquat Ali Khan told AFP that a motor mechanic was killed and two children wounded in the blast.

Administration official Siraj Ahmad said the bomb was a crudely made device similar to those used to deadly effect by Taliban militants against US troops in neighbouring Afghanistan and government troops in northwest Pakistan.

“It was a roadside explosion caused by an IED (improvised explosive device). The school bus was very close by, that's why it damaged the bus,” Ahmad said.

“The bomb was planted (on the roadside) but we're investigating what the real target was, because police also patrol this area,” police official Mohammad Ijaz Khan told reporters.

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