Pakistani Prime Minister  Yusuf Raza Gilani plans to meet opposition leaders on Monday  in a bid to head off a possible vote of no confidence after a  key partner quit the governing coalition.

Gilani's government lost its parliamentary majority on  Sunday after the Muttahida Qaumi Movement (MQM) announced it  would go into opposition because of what it said government  fuel price policies that are "unbearable" for Pakistanis.

The MQM pullout plunged the South Asian country, vital for  US efforts to pacify Afghanistan, into a deep political  crisis.

It also adds to uncertainty over the government's struggle  to meet economic policy demands placed on it by the  International Monetary Fund in return for an $11 billion loan.

The Karachi Stock Exchange's benchmark 100-share index   was down 1.72 percent, or 206.56 points, at 11815.90, on  turnover of 43.44 million shares by 11:09 a.m. (0609  GMT).

The  MQM's withdrawal means that if opposition parties close ranks,  they would be able to force a no-confidence vote on Gilani in  parliament.

If the crisis deepens, an early election may be called. Gilani is scheduled to meet the president of the biggest  opposition party in the National Assembly, the Pakistan Muslim  League (PML-N) on Monday.

"The Prime Minister will discuss the political situation  with Shahbaz Sharif and ways and means to resolve this  crisis," an official in Gilani's office told Reuters.          

He is also due to meet Chaudhry Shujaat, leader of another  major opposition party, the PML-Q. "He indicated he would seek  our support,"," said a party official.     

The MQM pullout came after Jamiat-e-Ulema-e-Islam (JUI), a  pro-Taliban religious party, quit the coalition last month  after Gilani sacked one of its ministers.     

While analyst doubt that Gilani would see out his term,  which ends in 2013, the chances of the opposition forming a  new ruling alliance are slim. The PML-N, headed by popular  politician Nawaz Sharif, does not enjoy close ties with other  opposition parties.

The political paralysis will make it even harder for  leaders to tackle a wide array of problems frustrating  millions of Pakistanis -- from corruption, to poverty to  suicide bombings carried out by Taliban militants. - Reuters