Two militants were killed in a shootout with security forces in India-held Kashmir on Sunday, the army and police said.

Acting on a tip-off, Indian security forces surrounded a thickly forested area near the northern town of Handwara, 70 kilometres away from Srinagar, triggering the clash, said officials.

The bodies of the dead were recovered along with their weapons, Indian army spokesman Rajesh Kalia told AFP.

Kashmir has been divided between India and Pakistan since the end of British colonial rule in 1947. Both claim the Himalayan territory in full.

A revolt against Indian rule over held Kashmir broke out in 1989 and tens of thousands of people, most of them civilians, have been killed since then.

Around 500,000 Indian soldiers are deployed in the region.

Rebels have repeatedly attacked government forces in recent weeks. Last week suspected insurgents abducted and killed a military officer who was home on leave for a wedding in Shopian district.

Clashes have become more frequent following widespread unrest last year which was sparked by the killing of a popular rebel leader Burhan Wani by security forces in July, last year.

Police and army officials say dozens of local youths have joined the rebel ranks since then. Some 30 armed militants, mostly locals, have died fighting government forces this year.