KATHMANDU -- Thousands of people marched in the Nepali capital on Friday to press the government and Maoist rebels to resume peace talks, just days after the insurgents called an end to a truce.

More than 10,000 people -- including school children and their teachers -- began a five-km (three-mile) silent march after offering prayers at the Martyrs' Memorial in the heart of the city, Reuters reported.

"Both sides must hold talks and not push the country to the brink of a civil war," said Umesh Shrestha, head of the Private and Boarding Schools' Organization Nepal, a sponsor of the march.

"We Want Peace," read a placard carried by a student in the march that passed through Kathmandu’s narrow streets, dotted by ancient Hindu and Buddhist temples.

The Maoist chief, known only as Prachanda, said on Wednesday that the guerrillas were breaking a seven-month truce and abandoning peace talks after the government refused their demands for a new constitution to define a role of the king.

The rebels have been fighting since early 1996 for a communist republic to replace Nepal's constitutional monarchy in a revolt that as seen more than 7,200 people killed, has shattered the economy and has also scared away tourists.

A day after the truce was called off, suspected rebels killed an army colonel and wounded another in Kathmandu and also raided a bank in west Nepal. Police said the rebels on Friday bombed and torched the country residence of Finance Minister Prakash Chandra Lohani, about 100km (60 miles) north of Kathmandu early.

The house was unoccupied, police said.

While the government has asked the rebels to resume talks, it has also declared them "terrorists" -- a move which gives sweeping search and detention powers to the army and paramilitary forces.