At least seven people were killed and around a dozen others were injured when a powerful bomb blast shook the central Punjab town of Gujrat yesterday.

The blast took place right outside a private school in a crowded area at a time when children were leaving the premises after a rehearsal for the Independence Day celebrations.

Many school children organise functions at schools on August 14, Pakistan's national day. The bomb was placed in an auto-rickshaw parked near the school building. The driver of the vehicle was among those killed. The offices of the local civic corporation are also housed in the same area, which is almost always thronging with people.

A police officer, who reached the spot within minutes as panic spread, told Gulf News, "There were scenes of utter mayhem all around. People were fleeing, leaving behind their bags and belongings, and there were fallen bodies that were being trampled."

He added, "Terrified school children clung to walls and any place of shelter they could find." A senior police official said three men, one woman and three children were killed by the blast. Five of those killed belonged to a single family and were believed to be standing close to the rickshaw at the time of the explosion.

"It's terrorism, without any doubt, and at a place selected to cause maximum damage and fear," Riaz Ahmed, senior superintendent of police, said.

The blast is the latest in a series of terrorist acts that have shaken the Pakistani province of Punjab for many years. It comes after a lull of several months.

"This distinctly follows the pattern of past attacks – at bus stands, markets and other areas," said another police officer. Some members of the district administration, following past patterns, have blamed the attack on an "enemy hand."

This is a euphemism frequently intended to mean Indian agents, and many similar attacks have been blamed on such operatives, although often without any proof.

Tabassum Inam, a school teacher who was also leaving the school at the time, said she was "waiting for a van or auto-rickshaw, when she heard a loud noise."

She added that she screamed and looked around to see "large clouds of dust, and panic-stricken people running everywhere." Another eye-witnesses also said the blast had resulted in bodies being hurled "many metres" into the air.

Ambulances and police arrived at the scene fairly quickly, and children were taken back to the school until their parents could collect them. A search for other bombs was also conducted in the area, but none was found.