A sniffer dog located what the police bomb detection and disposal squad called 'a live bomb' wrapped in a plastic bag at the facility, the Press Trust of India news agency said.

Indian television station NDTV said 50 people had been evacuated from the building.

Police in Maharashtra state were not immediately available for comment when contacted by AFP.

The discovery came as India was on high alert following deadly attacks in the Maharashtra state capital Mumbai on Nov 26-29, in which 163 civilians and security personnel were killed by Islamist militants.

Nagpur is about 900 kilometres north-east of Mumbai. -- AFP