Dubai has signed an accord to build infrastructure in Indian occupied Kashmir, the Modi government said on Monday, at a time when the region is seeing a resurgence in violence.

No figure for the value of the accord was given.

The memorandum of understanding by Dubai, one of the UAE's seven emirates, is the first investment agreement by a foreign government in the sensitive region following the stripping of Kashmir's autonomy and the division of the Muslim-majority state into two territories directly ruled from New Delhi.

The New Delhi government said the agreement will see Dubai building infrastructure including industrial parks, IT towers, multi-purpose towers, logistics centres, a medical college and a speciality hospital.

“The world has started to recognise the pace [at] which Jammu and Kashmir is traversing on the development bandwagon,” Indian Trade Minister Piyush Goyal said in a statement.

The statement said different entities from Dubai had shown keen interest in investment in Kashmir.

However, investment is fraught with risks in the heavily militarised region as evidenced by a spate of attacks on civilians and a widespread crackdown by security forces that has left several people dead.

On Monday, Indian authorities moved thousands of migrant workers in Kashmir to safer locations overnight while hundreds have fled the Himalayan valley after a wave of targeted killings.