An explosion near the Punjab Assembly in Lahore killed at least 13 people and wounded dozens on Monday, a local emergency rescue service said.

Mushtaq Sukhera, inspector general of police in Punjab, said five police officers were among the dead when an explosion rocked a protest organised by chemists and pharmaceuticals manufacturers.

"It was a suicide attack. The bomber exploded himself when successful negotiations were underway between police officials and the protesters," Sukhera told reporters.

Among the dead are eight victims at Ganga Ram Hospital and five have been identified as Bilal Amjad of Ravi Park, Mohsin Irshad of Sheikhupura, Umar of Malik Park, and two elite force members Muhammad Aslam and Irfan Mahmood.

Rescue sources said at least 83 injured have been transported to different hospitals across the city. Forty-two people have been admitted to Ganga Ram, 26 to Mayo Hospital, 12 to Services, two to General Hospital while one injured has been admitted to Jinnah Hospital. 

A cousin of SSP Zahid Mehmood, the police officer killed in the blast, tweeted after the attack.

A spokesman for Jamaat-ur-Ahrar, a faction of the Taliban, called Reuters and claimed responsibility for the suicide attack.

The militant group also warned the Lahore attack was the start of a new campaign against government departments. "You are on our target across the country," it added in a statement.

Jamaat-ur-Ahrar had also claimed responsibility for an Easter Day bombing in Lahore last year that killed more than 70 people in a public park.

Day of Mourning

Punjab will observe a day of mourning on Tuesday in wake of the deadly blast, the provincial government announced in a twitter message.

Security in Pakistan has vastly improved in recent years but militant groups such as the Taliban and Islamic State still pose a threat and have carried out mass attacks.

Prime Minister Nawaz Sharif said the attacks will not weaken Pakistan's resolve in fight against militancy.

"We have fought this fight against the terrorists among us, and will continue to fight it until we liberate our people of this cancer, and avenge those who have laid down their lives for us," he said in a statement.

The latest blast may jeopardise plans by Pakistan, a cricket-obsessed nation, to host the final of its domestic Twenty20 tournament on home soil in Lahore in March.

For years, Pakistan's international test cricket matches have been played abroad and the current Twenty20 tournament is being played in United Arab Emirates due to security fears.