Two Kashmiri fighters, including a key leader, were killed by Indian government forces during a 12-hour gun battle in the occupied valley's capital on Tuesday, authorities said.

Such clashes are a common occurrence in India-occupied Kashmir (IoK) but rare in Srinagar, and the siege marked the first shootout in the city's centre for two years.

Explosions and gunshots echoed through the densely-populated neighbourhood, with streets largely empty as a result of a coronavirus lockdown that has kept most residents confined to their homes.

Paramilitary troops and police exchanged fire with Kashmiri fighters after cordoning off part of the area. Five homes were reduced to rubble during the battle and 10 others were severely damaged, residents told AFP.

Junaid Ahmed Sehrai, a commander of Hizbul Mujahideen and the son of a top separatist leader, was killed in the clash, police said in a statement.

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Another Hizbul Mujahideen member was also killed and four Indian police officers were wounded, the statement said.

Most mobile voice and internet services were cut across the city as the fighting kicked off and have yet to be restored.

Locals poured onto the streets as news of the killings spread to hurl stones at Indian forces, who fired tear gas and shotgun pellets to disperse them. No injuries were reported.

The deaths came two weeks after Hizbul Mujahideen chief Riyaz Naikoo and a close aide were killed by government forces during a two-day gun battle.

Counterinsurgency operations in IoK have been stepped up during the coronavirus lockdown, while fighters have continued to attack government forces.

Unlike in the past, authorities now bury slain fighters far away from their homes in unpopulated frontier areas to stop large funerals from being held.

Police said 73 fighters had been killed in occupied Kashmir this year, many of them during Ramazan.