Major markets, schools and colleges were closed, while hotels and industries halted their operations today as the Federation of Nepalese Chamber of Commerce and Industries called an indefinite strike from Monday afternoon to protest against the Maoists' extortion drive and beating of a hotelier in Kathmandu.

However, transport services operated normally in Kathmandu with taxis, private cars and public buses plying regularly.

Meanwhile, Maoist chairman Prachanda has apologised for the attack by his cadres on Hari Shrestha, 70-year-old owner of Hotel Woodland -- a three-star property situated just 200 metres away from the Royal Palace.

On Sunday, a group of Maoists entered the hotel and demanded Rs 10 million from the hotelier, who refused.

Enraged Maoist cadres beat him up severely before releasing him, sparking agitation among the business community.

Talking to a private television channel over telephone from Dhangadhi in western Nepal, Prachanda said his party would take action against those involved in the incident and expressed sorrow over it.

"We express our sorrow over the incident that has happened at a time when the nation is moving ahead on the process of forming a new interim government inclusive of the Maoists," said Prachanda.

The strike hit business activities in Kathmandu's all three cities: Kathmandu, Bhaktapur and Lalitpur municipalities and other major cities across the country, where factories, business centres, schools, colleges and markets remained largely closed.