Shah, who also ran a television station and satellite network, was shot dead Sunday by two assailants on a motorbike near the French embassy compound in the heart of Kathmandu.

"We have raised the security alert in the capital and the hunt for the murderers of Shah is on," said Kathmandu police chief Ganesh K.C.

Ganesh declined to speculate on a possible motive for the attack but said that elements of the shooting suggested the possible involvement of an "international crime syndicate."

Shah, a Nepalese of Kashmiri origin, had been accused of having links to the South Asian underworld, including the most wanted man in India, organized crime kingpin Dawood Ibrahim. He had always denied the allegations.

Shah, 47, was the chairman of Space Time Network, a satellite network and Channel Nepal, a satellite television station. He was the first to introduce private cable television to Nepal in 2001.

Police said Shah died almost immediately after being shot three times at point blank range - twice in the head and once in the chest.

His driver Mathura Malakar was also shot, but survived.