A powerful bomb was found on Wednesday from near a pharmacy in the crowded Imphal market complex locally known as Khwairamband in Manipur.
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The bomb hidden in a bag was later defused by the bomb squad personnel, official reports said.
The police said an unknown person came to the market to buy medicine from a pharmacy shop owned by W Ranbir yesterday and left the bag with the bomb in front of it.
Ranbir, when opened the shop this morning, thought someone forgot his bag. A letter was found inside his shop saying "Warning Ranbir" and the bag before your shop contains a bomb.
He immediately informed the police who later recovered the bag with the bomb.
Investigations have been continuing on the identity of the person who placed the bomb in a tight security area.
Shop-owners and women vendors protested the incident and appealed to the militants not to do so in a crowded area, the police said.