Two bombs exploded in a crowded shopping district in the southern Indian city of Hyderabad, killing at least 12 people and wounding 50 more in the worst blasts in the country in more than a year, officials said.

The explosions occurred about two minutes apart in the early evening outside a cinema and a bus station. Storefronts were shattered, motorcycles covered in debris, and food and plates from a roadside restaurant were scattered on the ground near a tangle of dead bodies.

"This is a dastardly attack, the guilty will not go unpunished," Manmohan Singh, the prime minister, said. He appealed to the public to remain calm.

The bombs were attached to two bicycles in the Dilsukh Nagar district, Sushilkumar Shinde, home minister, said. The district is a shopping area near a residential neighbourhood.

Eight people died in one explosion and three in the other, Shinde explained.

Mahesh Kumar, a 21-year-old student, was heading home from a tutoring class when one of the bombs went off.

"I heard a huge sound and something hit me, I fell down, and somebody brought me to the hospital," said Kumar, who suffered shrapnel wounds.

Hyderabad, which has a population of more than seven million, is a hub of India's information technology industry and has a mixed population of Muslims and Hindus.

The explosions were the first major bomb attack to hit India since a September 2011 blast outside the high court in New Delhi killed 13 people. The government has been heavily criticised for its failure to arrest the masterminds behind previous bombings.

Home secretary RK Singh said officials from the National Investigation Agency and commandos of the National Security Guards were leaving Delhi for Hyderabad, the capital of Andhra Pradesh.

Rana Banerji, a former security official, said India remained vulnerable to such attacks because there was poor co-ordination between the national government and the states.

Police reforms were also moving very slowly and the quality of intelligence gathering was poor, he said.

"The concept of homeland security should be made effective, on a war footing," he said.

India has been on a state of alert since Mohammed Afzal Guru, a Kashmiri, was executed in a Delhi jail nearly two weeks ago. Guru had been convicted of involvement in a 2001 attack on India's parliament that left 14 people dead, including five gunmen.

Many in Indian-ruled Kashmir believe Guru did not receive a fair trial, and the secrecy with which the execution was carried out fuelled anger in a region where anti-India sentiment runs deep.