One person was arrested and three others detained for interrogation in connection with the blast in Colonelgunj area of Kanpur, police said on Wednesday.
The police arrested Kamal Kumar Sahu, who runs a general store near the site of the blast that left seven people, including four children, injured on Tuesday night.
A large number of crackers were recovered from the shop, Dayanand Mishra, superintendent of police (West), said.
Sahu did not have the required license to sell the crackers and was arrested for illegally storing and selling them, he added.
However, Mishra said that it was too early to say whether Sahu was related to the blast.
The low-intensity bomb was packed in a polythene packet on a cycle. Mishra said three others have been detained for interrogation.
The police are trying to trace the owner of the cycle, he said.
