Indian searches for suspects amid tensions with Pakistan

Armed police and soldiers searched homes and forests for militants in Kashmir and India's army chief visited the area to review security, after the killing of 26 men earlier this week - the worst attack on civilians in nearly two decades.

The militant attack prompted outrage and grief in India, along with calls for action against neighbour Pakistan, whom New Delhi accuses of funding and encouraging terrorism in Kashmir, a region both nations claim and have fought two wars over.

India's army chief visited Srinagar, the capital of Indian-administered Kashmir, and authorities scoured Pahalgam, the scenic town where the militant attack took place on Tuesday.

India said there were Pakistani elements in Tuesday's attack, when militants shot 26 men in a meadow in the Pahalgam area.

Pakistan has denied any involvement.

Indian financial markets plummeted earlier in the day but recovered some of their losses by the close of trade.

The key stock indexes ended lower by 0.7% - 0.9%, while the Indian rupee ended 0.2% down, while the 10-year benchmark bond yield rose four basis points.

The nuclear-armed nations have unleashed a raft of measures against each other.

India suspended a critical river water-sharing treaty and Pakistan closed its airspace to Indian airlines.

India's air force and navy both carried out military exercises yesterday.

Pakistan ordered the expulsion of Indian diplomats and military advisers, cancelling visas for Indian nationals - with the exception of Sikh pilgrims - and closing the main border crossing from its side.

Pakistan also warned any attempt by India to stop the supply of water from the Indus River would be an "act of war."

General Upendra Dwivedi visited Kashmir to review security arrangements a day after Prime Minister Narendra Modi vowed to chase the perpetrators to "the ends of the earth".

Mr Modi said those killed in the attack came from all over India. Television channels showed funerals of victims taking place in several states and newspapers carried photos of women grieving and people praying in front of funeral pyres.

India's chief opposition leader Rahul Gandhi also visited Srinagar, meeting the injured and local government heads.

India's top two airlines, IndiGo and Air India, said some of their international routes, including to the United States and Europe, would be affected by the closure of Pakistani airspace, leading to extended flight times and diversions.

There have been calls for and concern that India could conduct a military strike in Pakistani territory as it did in 2019 in retaliation for a suicide bombing in Indian-controlled Kashmir that killed at least 40 Indian paramilitary police .

Several leaders of Mr Modi's Hindu nationalist Bharatiya Janata Party have called for military action against Pakistan.

The two countries both claim Muslim-majority Kashmir in full, but rule it in part.

India, a Hindu majority nation, has long accused Islamic Pakistan of aiding separatists who have battled security forces in its part of the territory.

Pakistan denies this.

Indian officials say the attack had "cross-border linkages".

India destroys homes of suspects

Earlier, soldiers in Indian-administered Kashmir blew up the family homes of two men who police allege were among the gang that carried out the attack.

Police say they are members of the Pakistani-based Lashkar-e-Taiba (LeT), designated a terrorist organisation by the United Nations.

Kashmiri police issued notices with sketches of three men 'involved" in the violence: Indian national Adil Hussain Thoker, as well as Pakistani citizens Ali Bhai and Hashim Musa.

They are also searching for Indian citizen Ashif Sheikh.

India has not elaborated on the links or shared proof.

Members of the two Indian fugitives' immediate families were detained for questioning after the attack, an officer and their relatives said.

Police said the men were part of a LeT faction called The Resistance Front (TRF).

"Both have been active for three to four years, and are part of TRF which is an offshoot of LeT," a police intelligence officer said, speaking on condition of anonymity, because they were not authorised to speak to the media.

"They are wanted militants involved in earlier attacks as well on security forces," the officer added.

Police have offered a two million rupee (€20,737) bounty for information leading to each man's arrest.

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The United Nations has urged India and Pakistan to show "maximum restraint" as the nuclear-armed rivals imposed tit-for-tat diplomatic measures following the attack.

"We very much appeal to both the governments ... to exercise maximum restraint, and to ensure that the situation and the developments we've seen do not deteriorate any further," UN spokesperson Stéphane Dujarric told reporters in New York yesterday.

"Any issues between Pakistan and India, we believe, can be and should be resolved peacefully through meaningful mutual engagement," he added.

Denying any involvement, Pakistan called attempts to link Pakistan to the Pahalgam attack "frivolous" and vowed to respond to any Indian action.

"Any threat to Pakistan's sovereignty and to the security of its people will be met with firm reciprocal measures in all domains," a Pakistani statement said, after Pakistan Prime Minister Shehbaz Sharif held a rare National Security Committee with top military chiefs.

Kashmir has been divided between India and Pakistan since its independence in 1947, with both claiming the territory in full but governing separate portions of it.

Rebel groups have waged an insurgency in Indian-controlled Kashmir since 1989, demanding independence or a merger with Pakistan.

'Reduce it to dust'

Pahalgam marks a dramatic shift in recent Kashmiri rebel attacks, which typically target Indian security forces.

Experts say that a military response may still be in the pipeline, with some speculating that it may come within days, while others say weeks.

In 2019, a suicide attack killed 41 Indian troops in Kashmir and triggered Indian air strikes inside Pakistan, bringing the countries to the brink of all-out war.

"Whatever little land these terrorists have, it's time to reduce it to dust," Mr Modi said, after holding two minutes of silence in memory of those killed, all but one of whom was Indian.

India has taken its time to respond to past attacks.

The worst attack in recent years in Indian-run Kashmir was at Pulwama in 2019, when insurgents rammed a car packed with explosives into a police convoy, killing 40 and wounding 35.

Indian fighter jets carried out air strikes on Pakistani territory 12 days later.

Tuesday's assault occurred as tourists enjoyed tranquil mountain views at the popular site at Pahalgam, when gunmen burst out of forests and raked crowds with automatic weapons.

Survivors told Indian media the gunmen targeted men and spared those who could give the Islamic declaration of faith.

Indian security forces have launched a vast manhunt for the attackers, with large numbers of people detained.

The attack has enraged Hindu nationalist groups, and students from Kashmir at institutions across India have reported experiencing harassment and intimidation.