Indian Prime Minister Narendra Modi said today the people and the government of held Kashmir would show “those people on the other side of Kashmir” how they are being left behind in growth and development.

Modi urged the youth of Kashmir to choose tourism and development over terrorism, shortly after inaugurating a 37.2-billion Indian rupee ($574-million) highway tunnel in the volatile valley.

"While on the one hand youth in Kashmir were busy pelting stones, on the other some youth were breaking stones to carve out this tunnel," he said, referring to unrest in the state that followed a security force raid that killed militant leader Burhan Wani last July.

The violence since last summer, largely in the form of troops firing on civilian crowds with shotguns after protesters throw stones, has left 84 civilians dead and more than 12,000 civilians and security force personnel wounded.

In addition to increased security, Modi's government has tried wooing the local population with the promise of a better future through investment, job creation and infrastructure development.

Modi said the new tunnel would not only help farmers in the region take their produce to the capital in less time and avoid weather disruptions, but would potentially double tourism in the state. A government press release said the project "has provided employment to over 2,000 unskilled and skilled youth of Jammu and Kashmir as 94 per cent of the work force was from the state".

"We have a plan to make nine such tunnels in the state," Modi said, adding better connections would mean more jobs.

Both India and Pakistan claim Kashmir in full, but govern separate parts, and have fought three wars since independence from Britain in 1947, two of them over Kashmir.

Separatist factions of Kashmir had called for a strike to oppose Modi's visit.

About an hour after the speech, a policeman was killed and seven others were injured when militants hurled a grenade at them in Nowhetta area of Srinagar.