At least 44 people were killed in a town in central India on Saturday when a cooking gas cylinder blew up in a restaurant and set fire to explosives stored nearby, police said.

The gas cylinder exploded as people were gathering for breakfast at the restaurant in the town of Petlawad in the state of Madhya Pradesh, about 800 km (500 miles) south of New Delhi, Inspector B.L. Gaur told Reuters.

Gaur said the restaurant was near an area which stored gelatine sticks used at construction sites.

"There was a second explosion, there were more casualties," Gaur said, adding the blast was so powerful it damaged adjacent buildings and ripped out nearby windows.

Another 60 people were injured in the explosion, Gaur said.

Television footage showed a collapsed building and people searching for bodies in the rubble.

Madhya Pradesh's chief minister has announced compensation for the victims' families, local media reported.