Police raided a house in the city's industrial area and forced the militants to surrender after a gunbattle, said Raja Omar Khatab. No one was injured.
After their arrest, the suspects led police elsewhere to the bomb factory, and a large number of explosives, detonators and other bomb-making material was seized, he said.
Violence has surged in Pakistan in recent days as militants - thought to be part of a loose network of Islamist insurgents fighting the U.S.-allied Islamabad government
- launched a wave of suicide bombings.