A civilian was killed and several wounded Thursday in Indian-administered Kashmir when security forces opened fire on a crowd gathered for the funeral of three rebels slain overnight in clashes with soldiers, police said.

Thousands of villagers poured onto the streets for the funeral, chanting slogans against Indian rule and pelting stones at soldiers who responded with bullets and pellet fire, a police officer said.

S. P. Vaid, director general of police for the territory, confirmed a protester was killed in the exchange.

Another police officer, speaking on condition of anonymity, said at least a dozen others were injured by pellets fired by government forces to disperse the angry crowd.

On Wednesday night soldiers and counter-insurgency police surrounded a residential area where they suspected armed militants were hiding out, triggering a fierce exchange of fire.

Scores of residents then emerged from their homes to pelt stones at the soldiers in a bid to help the militants escape, a police officer said.

"Three terrorists were killed and three weapons recovered from the site," army spokesman Colonel Rajesh Kalia said earlier Thursday.

Witnesses said the army blew up the house where the militants were hiding in Kakapora, around 30 kilometres (19 miles) south of the main city of Srinagar.

One soldier was also injured in the gun battle, police said.

Kashmir has been divided between India and Pakistan since the end of British colonial rule in 1947 and both claim the territory in its entirety.

Rebel groups have for decades fought the roughly 500,000 Indian soldiers deployed in the territory, demanding independence or a merger with Pakistan.

Officials say dozens of young people have joined the rebels since last July, when the killing of a popular rebel commander by security forces sparked months of deadly anti-India protests.

Rebel attacks on government forces have increased since then while the army has also intensified counter-insurgency operations.

Source: AFP