June 28 (Bloomberg) -- Pakistani paramilitary troops attacked a stronghold of Islamic militant insurgents between the country's northwestern provincial capital and the Afghan border today, and a prominent Taliban commander announced he was breaking off peace talks with the government.

Soldiers of Pakistan's Frontier Corps with armored vehicles and mortars destroyed the home of guerrilla leader Mangal Bagh, about 20 miles (30 kilometers) west of Peshawar, the capital of the North-West Frontier Province, officials told Pakistani news organizations. Bagh and his fighters had melted away before the offensive, into rugged mountains near the border.

The commander of Taliban forces based 140 miles to the south, Baitullah Mahsud, said he had pulled out of peace talks over the attack. The army and government have been seeking peace deals with Mahsud and several allied militant groups since an elected parliament and cabinet took office in April following eight years of military rule.

The government launched its assault today to halt growing Taliban incursions into Peshawar, a strategically vital city that includes a major air force base and an army corps headquarters. While the army has moved reinforcements toward Mahsud's stronghold of Waziristan, it was not clear how broadly the military is prepared to attack a swath of Islamic militant insurgencies that stretch for 220 miles through Pakistan's ethnic Pashtun region adjoining Afghanistan.

``Should there be a need'' for action beyond today's attacks, ``the army will be there,'' said the military's chief spokesman, General Athar Abbas, in an interview on the independent TV channel Dawn News.

Reinforcements

The Frontier Corps' assault was in Pakistan's semi- autonomous tribal zone along the border. Such attacks often have triggered reprisals, often suicide bombings, by the Taliban. Before today's assault, the government reinforced Peshawar, deploying hundreds of paramilitary police and installing concrete barriers at police stations to stop potential car bombers.

The government acted after armed Taliban fighters drove into the city in the past week, intimidating residents and briefly abducting more than 20 members of the city's Christian minority.

The city of 3 million people was outwardly calm amid sweltering heat, though Peshawar residents voiced nervousness at the fighting close by and the prospect of Taliban retaliation.

``We have no television here, but people are spreading the news by telephone that the fighting has started,'' said Ali Imam, a clerk in a downtown office building.

Taliban Incursions

``The shopkeepers are closing their shops before dark, and I know people who have left because they are afraid we may face fighting,'' said Khalid Khan, a middle-aged resident buying food in the city bazaar.

The Taliban ``have made incursions into the city,'' said Abbas, the military spokesman, ``but the threat has been exaggerated,'' he said, referring to Pakistani press reports suggesting that Peshawar might fall to the militants.

The government assault today targeted Lashkar-i-Islam, a movement headed by Bagh that has sent pick-up trucks with armed fighters into Islamabad to warn shopkeepers against selling music, movies and other goods they regard as ``un-Islamic.'' The group has been battling a rival faction for the past week, a fight that has left more than 50 dead, according to officials.

Local groups of Islamic militants, many using the label ``Taliban,'' have stepped up attacks this year across a 220-mile swath of Pakistan's ethnic Pashtun region adjoining Afghanistan. For the first time, they've taken control of villages just outside Peshawar.

Use of Force

Pakistan on June 25 revived a promise to use force if necessary to prevent Taliban based in Pakistan from continuing attacks on U.S.-led NATO forces in Afghanistan. U.S. Army General David McKiernan, the new commander of NATO forces in Afghanistan, and U.S. Ambassador James Pardew, NATO's deputy secretary-general for operations, have been in Pakistan this week to discuss improving coordination with Pakistani forces after a June 10 border clash in which NATO troops killed 11 Pakistani troops.

McKiernan's predecessor, General Dan McNeill, said this month the Taliban increased cross-border attacks by as much as 50 percent after Pakistan's coalition government took office in April and, with the army, began a new round of peace talks with them.

Pakistan's renewed vow to use force if necessary against the Taliban and allied militant groups is ``a good sign,'' said Mehmood Shah, a retired brigadier and former security chief of the tribal area on the border. Any negotiations ``must be carried out with the military option on the table,'' he said in a telephone interview, because hard-line militants among the border tribes will back down only under force.

The newspaper Dawn criticized the government this week for moving too slowly to confront the rising militant challenge in the northwest. The civilian coalition government that took office after winning February elections has been absorbed by its power struggle with Musharraf, the newspaper said in a commentary by its Peshawar bureau chief, Ismail Khan.

``The parliament has yet to debate Pakistan's participation in the 'war on terror,' define its rules of engagement and, more important, prepare a comprehensive counterinsurgency strategy,'' Khan wrote.

To contact the reporter on this story: James Rupert in Peshawar, Pakistan at jrupert3@bloomberg.net.

Last Updated: June 28, 2008 14:18 EDT