Twenty-three people were killed and 27 got injured in the explosion in Batala town.
Scattered shoes, broken glass panes and vehicles were seen all over the accident spot, as security personnel and rescuers were sifting through the rubble in search of survivors.
Chief Minister Amarinder Singh is visiting the spot on Thursday.
"The search operation is almost in a final stage," a National Disaster Response Force (NDRF) official told the media.
The dead included the firecracker manufacturing unit's owner and six of his family members.
Deputy Commissioner Vipul Ujwal said seven grievously injured were referred to the Guru Nanak Hospital in Amritsar.
A number of nearby buildings, including a car workshop, were badly damaged in the explosion. An elderly woman and her grandchild, who were passing close to the disaster spot, were among the dead.
The cause of the blast, which damaged the buildings in radius up to 200 metres, is yet to be ascertained, police said. Even a few stranded vehicles were flung up in the air with the blast.
Cabinet minister Sukhjinder Singh Randhawa, who reached the accident spot on Wednesday, announced a compensation of Rs 2 lakh to the next of kin of the dead and Rs 50,000 for the injured.
The government ordered a magisterial probe into the incident.
Locals complained the firecracker unit was running illegally for the past many years. It were manufacturing and storing crackers for the birth anniversary celebrations of Sikhism's founder Guru Nanak Dev.
"The firecracker factory has been working in this locality for the many years. We have complained against the factory seven-eight times to the local administration, but no action has been taken against it," a local resident told the media.
He said a similar blast occurred in this area in January 2017, leaving one person dead and three injured.
( With inputs from IANS )