Islamabad - A devastating bomb ripped through a busy market in the north western city of Peshawar Wednesday, just hours after U.S. Secretary of State Hillary Clinton arrived in Pakistan.

Officials put the death toll at more than 80, with over 200 wounded. Many of the victims thought to be women and children who were out shopping in the bazaar. Dozens of people were feared to be buried under the rubble.

The country is reeling under a wave of terrorism that's accompanied the army's offensive in South Waziristan, the region on the Afghan border that is the center for Pakistan's extremist groups. Cities across Pakistan have been hit by bombs and gun attacks since the beginning of this month.

The blast in Peshawar flattened rows of shops, and ignited a fire that engulfed the area, inside Peshawar's congested old city. Bewildered injured people were seen stumbling out of the dust and thick smoke in the narrow street. Locals were trying to dig people out of the debris. The explosion came from a powerful car bomb, officials said.

The local head of the bomb disposal squad, Shafqat Malik, at the site of the blast, said that over 150kg of high explosives were used.

The buildings were old and collapsed easily, including a mosque. The Peepal Mandi market was known for selling make-up, and wedding-related goods, making it a popular destination for women. Shopkeepers had previously received threats from Islamic extremists who objected to women out shopping.

"The terrorists are trying to demoralize the people and the government," said senior provincial minister Bashir Bilour, visiting the scene. "Even if we have to die, we'll keeping fighting these terrorists till our last breath."

Clinton began a three-day visit to Pakistan, amid extraordinary security measures. The U.S. Secretary of State is seeking to repair the American image in Pakistan, which was badly damaged by a recent row over a U.S. aid bill. Many Pakistanis blame the American presence in the region for the instability that has struck Pakistan and Afghanistan.

With the attack Wednesday in Kabul, at a guest house used by the United Nations, the chaos that's gripped the Obama administration's "AfPak" policy seemed to be laid bare.

"I want you to know that this fight is not Pakistan's alone," Clinton told a news conference in Islamabad Wednesday. "This is our struggle as well."