The blast, in which several ISI agents werereported killed, flattened one building and sheared the walls off others in one of the deadliest attacks in Pakistan this year.

Interior Minister Rehman Malik said the bombing could be retaliation to the govern ment’s military offensive to rout Taliban militants from the northwestern Swat Valley.

The attack, just off The Mall in central Lahore and the third major terror strike in three months, sent shock waves through the city.

No one immediately claimed responsibility for the latest bombing. Police said two suspects were detained.

“The moment the blast hap- pened, everything went dark in front of my eyes,” witness Muhammad Ali said.“The way the blast happened, then gunfire, it looked as if there was a battle going on.” Sajjad Bhutta, a government official in Lahore, told reporters a car carrying gunmen pulled up on a street between offices of the emergency police and the ISI.

“As some people came out from that vehicle and started firing at the ISI office, the guards from inside that building returned fire,” he said. As the shooting continued, the car exploded, he said.

Malik blamed the attack on militants that government forces are fighting in the Swat Valley.

“They are anti-state elements, and after being defeated in Swat, they have moved to our big cities,” Malik told the Express news channel.

The armyhas said at least 1,100 militants have been killed in the month-long operation and that Taliban fighters are in retreat.

The military on Wednesday said troops had cleared militants out of Piochar, a village in a remote part of Swat that is the rear base for Taliban leader Maulana Fazlullah,and predict ed that Mingora,the largest town in the valley,would be cleared of militants within three days.

Two other areas, Sultanwas and Mohmand, had also been emptied of militants and were now safe enough for refugees who have fled the fighting to return home.

It was the first time the military has invited some of the more than 2 million refugees from the region to return to their villages since the fighting began, setting off an exodus that aid officials said could turn into a humanitarian disaster.

In March, a group of gunmen attacked Sri Lanka’s visiting cricket team in the heart of the city, killing six policemen and a driver and wounding several players.

Later that month, gunmen raided a police academy on the city’s outskirts, leaving 12 dead during an eight-hour standoff with security forces, including army troops. Pakistani Taliban chief Baitullah Mehsud had claimed responsibility.