Indian forces in Held Kashmir killed two suspected separatists in a gun battle on Monday, police said, adding that a manhunt was under way for more militants in the area.

Soldiers and special police forces surrounded a neighbourhood in Sopore, 45 kilometres from the main city of Srinagar, after receiving a tip-off that armed militants were hiding there, triggering a firefight.

“Two militants killed in an encounter with police,” police said in a statement, adding that a search was on for others suspected of being holed up in the area.

In recent months, the Indian army has stepped up its hunt for anti-India 'militants' in the Kashmir valley after deploying thousands of additional troops for an offensive dubbed “Operation Allout”.

At least 140 suspected militants have been killed since the beginning of the year.

The latest gun battle came two days after Indian troops shot dead a suspected militant in southern Kulgam town, hours after 'militants' separately ambushed a police bus in Srinagar, killing one officer and wounding seven others.

Last month 'militants' attacked a police base in southern Pulwama district, leaving eight police and three attackers dead.