(Adds suspected bomb blast on railway track, six dead)

KARACHI, Sept 26 (Reuters) - Three Islamist militants who were planning an attack in Pakistan's biggest city, Karachi, blew themselves up on Friday when police raided their hideout, killing a hostage they had been holding for several months, police said.

Separately, a suspected bomb blast on a railway track derailed a train in Punjab province, killing six people including a woman and three children.

The raid in Karachi followed a tip-off from a suspect arrested earlier, said city police chief Waseem Ahmed.

"Police raided the house and had an exchange of fire with the militants there. When the militants ran out of ammunition, they blew themselves up. The house collapsed," Ahmed told Geo Television.

"They were planning a terror attack in Karachi," he said.

A police official said bodies of the militants and the hostage, who was a transport company owner and supplied goods to Western forces in Afghanistan from Karachi port, were found in the ruins of the house in a poor neighbourhood.

Police said the militants were believed to be the members of Lashkar-e-Jhangvi, an outlawed militant group which has links with al Qaeda and the Taliban.

A bomb disposal squad official said about 10 kg (22 lb) of high explosives and two jackets made with pouches for explosives that suicide bombers wear were recovered from the debris.

Pakistan is battling Islamist militants in the northwest, and they have responded with suicide bombings across the country, including one on the Marriott Hotel in the capital, Islamabad, last Saturday.

Most foreign companies operating in Pakistan are based in the commercial hub of Karachi.

The southern city has long had a reputation for bloody sectarian feuding and militant violence but has been relatively peaceful this year.

In the central province of Punjab, a suspected bomb blast derailed a train near Bahawalpur city, killing six people, said Nasir Zaidi, general manager of state-owned Pakistan Railways.

"The blast appeared to have been caused by a bomb placed under the railway track," Zaidi said.

A police official at the site said the explosion happened as the train was passing and three coaches were derailed.

It was not immediately clear if the victims were killed by the blast or when the coaches crashed off the damaged track. (Reporting by Aftab Borka and Imtiaz Shah; Additional reporting by Augustine Anthony; Writing by Robert Birsel; Editing by Valerie Lee)

AlertNet news is provided by