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A minimum of 16 people have died after a huge fire erupted at a clothing factory in Bangladesh, with officials warning that the death toll could increase.

16 bodies have been found but were charred beyond recognition, the fire department reported.

Grief-stricken relatives gathered outside the four-storey factory in the Mirpur district of Dhaka on Tuesday in looking for their family members still not found.

The fire, which erupted at the factory around midday, was brought under control after three hours. But an neighboring chemical warehouse continued to burn, authorities said.

Up until 21:00 local time (15:00 GMT) on Tuesday, the fire at the chemical warehouse had not been entirely put out, news sources indicated.

Emergency responders have not ascertained which of the two buildings caught fire first.

Based on eyewitnesses, the chemical warehouse stored chemical bleaching agents, plastic and hydrogen peroxide, all of which can worsen fires. Plastic also produces hazardous smoke when combusted.

Law enforcement and armed forces are still attempting to find the owners of the factory and the warehouse, emergency services head the department director told journalists.

An investigation on whether the warehouse was functioning with proper authorization is also ongoing, he added.

Crying family members waited outside the charred buildings, many of them clutching photographs of their lost relatives.

Present at the scene is a man seeking urgently for his daughter, his loved one.

"When I learned of the fire, I rushed here. But I still haven't found her... I just want my loved one back," he stated to reporters.

The devastating event has another time highlighted the security issues affecting Bangladesh's clothing sector, which employs millions of workers and is a crucial contributor to economic income for the nation.