A town in the south of Indian Held Kashmir was under curfew for a second day Saturday after two people were killed and dozens wounded in Hindu-Muslim clashes in the disputed Himalayan region, police said.

Stores and buildings were torched in the clashes on Friday, which erupted in Kishtwar town, 150 kilometres (90 miles) southeast of Srinagar after prayers marking the end of Ramadan.

The violence broke out when several hundred Muslims staged a march and shouted slogans attacking India and shouting "We want freedom" and were attacked by Hindus who objected to the demonstration.

"Two people died in the clashes and 23 were injured. An indefinite curfew is in force," police inspector general Rajesh Kumar told AFP.

Freedom fighter groups have been battling Indian forces since 1989 for the territory to be made independent or tied to Pakistan, in a conflict that has killed tens of thousands of people, mostly civilians.

Despite the protests and clashes, thousands of Muslims, visited mosques, shrines and prayer grounds to mark Eidul Fitr -- the end of the holy month of fasting.

Authorities rushed hundreds of federal paramilitary troops to the area after hours of rioting.

Kishtwar residents alleged members of the Village Defence Committees, controversial semi-official local groups drawn mostly from the Hindu community and armed by the government to fight the militants in their areas, used weapons during Friday's clashes.

A police official, who wished to remain anonymous, said authorities were looking into the allegations.

Shops and businesses remained shut in Srinagar in response to a strike over the clashes called by a top leader, Syed Ali Geelani, who had called for "peaceful protests" following what he branded as "state terrorism" after Eid prayers.

More than 30 people, including 20 security forces, were hurt in Srinagar during the clashes. Meanwhile, shops and other businesses remained shut in Jammu  in response to a shutdown called by the Hindu nationalist Bharatiya Janata Party.