Five people have been arrested over an illegal fireworks display that killed 108 people in the southern state of Kerala on Sunday.

The fire spread outside a Hindu temple at Kollam, where thousands of people were gathered to celebrate the start of the Hindu year, after sparks ignited a cache of fireworks stored inside the temple grounds.

The district administration said it had not given permission for the fireworks display following complaints of noise and pollution.

Police officer Anantha Krishnan said the five suspects are employees of a fireworks manufacturer that was given the contract for running the show at the Puttingal Devi temple.

Around 380 people suffered injuries caused by flying concrete and debris.

Kerala's temples are managed by rich and powerful trusts that often flout local regulations. Each year temples hold fireworks displays, often competing to stage the most spectacular ones, with judges who decide the winners.

"There were so many men and women lying on the ground, lifeless," said local resident Anish Kumar, as grieving relatives were scouring the temple grounds for possessions of their loved ones.

The scale of the tragedy has ignited demands that fireworks shows be banned at crowded places in Kerala.

The Duke of Cambridge expressed his grief over the tragedy during a gala ball at Mumbai's Taj Palace Hotel, after he and his wife, Kate, arrived for a week-long visit to the region.

William told the guests: "Catherine and I would like to offer our condolences to all those affected by the terrible fire at the temple in Kollam. I know all of you in this room will join us in the sentiments."