Authorities in Pakistan have arrested counterterrorism police officers after they allegedly killed a middle-aged couple, their 13-year-old daughter and another man in what the police initially claimed was a shoot-out with armed fighters.

Police killed grocery store owner Mohammad Khalil, his wife Nabila, their daughter Areeba and a family friend, Zeeshan Javed, after stopping their vehicle late on Saturday near Sahiwal city in Punjab province.

Police claimed Javed was a "wanted terrorist" and initially accused him of using the others as human shields.

Family members and witnesses said police killed the four in cold blood and then tried to cover up their actions.

Angry residents in the area kept the bodies on the road in protest.

Authorities said they have launched an investigation and arrested the officers involved, without saying how many.

Prime Minister Imran Khan has vowed "swift action" against those found responsible for the killings.

"As soon as JIT [joint investigation team] report comes, swift action will be taken," he posted on Twitter.