Rail officials said police had found two suitcases filled with flammable material at the scene.
One was found inside a burned coach while the other was on the rail track.
"We have eyewitnesses who said they heard two blasts," VN Mathur, general manager of India's Northern Railways, said.
Mathur said dozens of bodies have been recovered from the burned-out coaches following the fire around midnight on Sunday near Panipat town, about 100 km north of the Indian capital, New Delhi.
The Samjhauta Express, which connects the capital to the northern Pakistani city of Lahore, was en route to Attari, the last station before the border with Pakistan.
Indian television channels showed rescue workers sifting through the charred remains of the carriages.
|Overcrowding on Indian trains |
is commonplace [EPA]
Because of security concerns, the train is kept sealed with doors locked and bars over many of the windows, and passengers may have been trapped inside the burning cars.
India's Times Now news channel said two petrol bombs were believed to have exploded, adding that it took one and a half hours for rescue workers to arrive at the scene at the village of Deewana, five kilometers from Panipat.
A top state government official said most of the victims were Pakistanis but included some Indian security personnel.
The fire immediately evoked memories of a fire aboard another train in the western state of Gujarat in 2002.
That blaze, blamed on Muslim gangs, killed 60 Hindus returning from a religious pilgrimage.
It triggered one of India’s worst outbreaks of sectarian violence in recent years, as Hindu mobs went on the rampage leaving more than 1,000 people dead, most of them Muslims.