The country is already facing a law and order problem in the wake of former premier Benazir Bhutto's assassination and the only way to arrest the slide is the coming of power by a democratically elected civilian government, the Brussels-based International Crisis Group said.

"Unless he (Musharraf) steps down, tensions will worsen and the international community may face the nightmare of a nuclear-armed, Muslim country descending into civil war from which extremists would stand to gain. Particularly the US must recognise he is a serious liability, seen as complicit in the death of the popular politician," the ICG has said.

In its latest briefing titled "After Bhutto's Murder: A way Forward for Pakistan", the ICG has concluded that Musharraf, who seized power in a 1999 coup, is no longer, if he ever was, a factor for stability.

"Bhutto's death has drawn the battle lines even more clearly between Musharraf's military-backed regime and Pakistan's moderate majority, which will settle for nothing less than genuine parliamentary democracy," Mark Schneider, Crisis Group's Senior Vice-President said.

The ICG has agreed with the Election Commission decision to postpone the parliamentary election scheduled for 8 January to 18 February "but only if additional steps are taken so that the delay contributes to the creation of conditions for free and fair elections and the restoration of democracy".