Supporters of Pakistan’s MQM attend a sit-in protest condemning the arrest in London of its leader, Altaf Hussain, in Karachi, on Wednesday. (AP)

KARACHI: Pakistan’s biggest city was in lockdown for a second day on Wednesday, with shops and markets closed and people staying home for fear of violence following the arrest in London of one of the country’s most feared men.

Altaf Hussain, leader of the powerful Muttahida Qaumi Movement (MQM) party and wanted in Pakistan in relation to a murder case, was arrested in northwest London where he has lived in self-imposed exile since the early 1990s.

Karachi, a sprawling and violent port city of 18 million, is virtually controlled by Hussain’s party, and reports of sporadic violence emerged as soon as news of his arrest reached the city.

On Wednesday, about 2,000 of his supporters rallied in the centre in support of Hussain but elsewhere the city was in lockdown, with markets and petrol stations closed and its usually chaotic and bustling streets empty of traffic.

“The people of Karachi and other big and small cities of Sindh (province) still see Altaf Hussain as their leader,” Nasir Jamal, a senior MQM official, told Reuters.

“The thrust of this protest is the release of Altaf Hussain. We are here until we see positive indications from London.”

The largely peaceful crowd sporadically burst into loud chants of slogans in support of Hussain. “Long live Altaf!” and “Even after death Altaf will continue to live!” shouted his supporters.

The ability of Hussain’s supporters to shut down Pakistan’s commercial hub for two days underscores his influence and many fear that riots might still erupt. But as of Wednesday evening no major acts of violence had been reported.

The cost of the shutdown will also weigh heavily on a city already beset by daily violence and feudal spats between its many ethnic and political groups.

A spokesman for London police said Hussain remained in custody where he is being questioned on suspicion of money laundering. “By this evening we will probably know if he’s going to be charged or released,” the spokesman said.

The MQM party’s support base is millions of Muslim Urdu-speaking people whose families migrated to Karachi and nearby areas at the time of the 1947 partition of India.

Hussain fled to London in 1992 and obtained British citizenship a decade later. He continued to exert control over Karachi from his north London headquarters and remains one of Pakistan’s most feared and divisive figures.

He is known for his fiery addresses to his supporters in Karachi though a loudspeaker connected to a telephone in his London home. His hold on Karachi is so strong that he is capable of shutting down entire neighbourhoods.

But his arrest poses broader risks for the party, whose influence has already been diluted in recent years by the influx of other ethnic groups to Karachi including Taliban-linked Pashtun warlords.