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At least 16 people have perished after a huge fire erupted at a clothing factory in Bangladesh, with authorities warning that the death toll could increase.

A total of sixteen bodies have been recovered but were burned unrecognizable, the fire service reported.

Distraught relatives assembled outside the four-storey factory in Mirpur, Dhaka on Tuesday in seeking their dear ones still unaccounted for.

The blaze, which erupted at the factory around lunchtime, was extinguished after three hours. But an nearby chemical warehouse kept burning, officials confirmed.

Up until 21:00 local time (15:00 GMT) that day, the fire at the chemical warehouse had not been fully extinguished, media reports reported.

Emergency responders have not ascertained which of the two buildings was the origin point.

Per bystanders, the chemical warehouse housed industrial bleaches, synthetic polymers and chemical peroxide, all of which can worsen fires. Polymer products also produces poisonous gases when combusted.

Law enforcement and armed forces are still searching for the owners of the factory and the warehouse, fire service director Mohammad Tajul Islam Chowdhury told the media.

An inquiry on whether the warehouse was running according to regulations is also in progress, he mentioned.

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

Among them is a man searching desperately for his daughter, Farzana Akhter.

"When I was informed of the fire, I rushed here. But I still cannot locate her... I just want my loved one back," he expressed to journalists.

The tragic incident has once again highlighted the hazardous conditions facing Bangladesh's apparel manufacturing, which employs countless of workers and is a significant contributor to export earnings for the South Asian economy.