LAHORE, Pakistan (Reuters) – Pakistan tightened security in the eastern city of Lahore on Thursday after three bomb attacks killed 33 people and wounded 171 and pressured the U.S.-backed government already overwhelmed by floods.

The blasts which hit a Shi’ite procession on Wednesday bore all the hallmarks of pro-Taliban insurgents, who have carried out sectarian violence designed to destabilize the government.

“Security has been tightened in the city to prevent any such incident. We had called the (paramilitary) rangers after the blasts last night, and they are on high alert and can be called again any time if needed,” Sajjad Bhutta, Lahore’s top administration official, told Reuters.

The government may face renewed militant violence as it tries to manage the country’s worst floods, and dull expected long-term economic pain caused by them, security analysts say.

The floods struck just as the army said it had made progress in the war against the al Qaeda-linked Sunni Taliban.

Reflecting the growing reach of the Pakistani Taliban, U.S. prosecutors overnight charged its leader Hakimullah Mehsud in the plot that killed seven CIA employees at an American base in Afghanistan last December.

The United States also added the Pakistani Taliban to its list of foreign terrorist organizations and set rewards of up to $5 million for information leading to the capture of two of its leaders, Mehsud and Wali-ur-Rehman.

Washington wants to see a stable Pakistan that can help fight militancy in Afghanistan and inside its own borders. Pakistani and U.S. officials are concerned that militant groups could seize of the disorder and misery caused by the floods to gain recruits.

ECONOMY SUFFERS

One month after waters started raging from the northwest to the south, millions are still homeless and potentially fatal diseases threaten to bring a new wave of death and suffering.

Day after day, Afshan Bibi, a mother of 11, trudges to a U.N. distribution center in Charsadda in the devastated Khyber-Pakhtunkhwa province to get relief supplies to help her cope. Housed in a tent encampment, she comes away with nothing.

“I’ve come here every day for a whole month, but I haven’t received anything,” she said.

Even before the floods struck, Pakistan was struggling with a fragile economy.

Those concerns have increased following widespread devastation to crops and infrastructure which Prime Minister Yusuf Raza Gilani estimated could hit $43 billion, almost one quarter of last year’s gross domestic product.

“The gloomy picture for the economy has already affected investor confidence, and the latest bombings have shattered that confidence further,” said Mohammed Sohail, chief executive officer of Topline Securities.

“Investors were assuming that because of the devastation caused by the floods, terrorism will slow down.”

Islamabad hopes the International Monetary Fund will soften terms of an $11 billion loan that has kept its finances afloat.

The IMF and Pakistan will release a statement on Thursday on ongoing discussions of the south Asian country’s loan.

The statement at 10:15 a.m. EDT (1415 GMT) follows a week of Washington talks against the backdrop of the floods which destroyed cropland and livestock and displaced millions.

U.S. textile groups and cotton farmers have strongly objected to proposed new trade benefits for Pakistan, saying the United States should send aid here, not U.S. jobs.

The textile industry, which will be hit hard by the crop damage, accounts for more than 50 percent of Pakistan’s exports and is a major employer in the manufacturing sector.

There was some good news from the World Bank, which has increased funding to help Pakistan cope with the floods by $100 million, to a total of $1 billion.