Two bomb blasts killed at least 16 people and wounded 117 others, the nation's home minister said Friday, raising the toll from the explosion at a busy marketplace a day earlier.
Vowing to bring the perpetrators to justice, Sushil Kumar Shinde told parliament that federal and state investigators are working together to probe Thursday's bombings in Hyderabad.
Terror involvement is a possibility, police commissioner Anurag Sharma said. He declined to name a particular group.
The two bombs were planted on bicycles parked in a crowded spot, the commissioner said.
They were improvised explosive devices, and could have been triggered by a timer.
Prime Minister Manmohan Singh called the strike a "dastardly attack" and said the perpetrators will be punished.
He directed government agencies to extend relief to authorities in Andhra Pradesh state. He also approved money for the next of kin of those killed and others seriously injured.