Moderate faction leader Mirwaiz Umar Farooq said the scenic Himalayan region, currently enjoying a period of relative calm, also risks a return to all-out violence reminiscent of the early days of the 17-year-old insurgency.

"The time is ripe to resolve the dispute over Kashmir. If that doesn't happen we may return to square one and violence may stage a comeback," he told a news conference in Srinagar, the urban hub of the anti-India revolt.

"New Delhi is trying to buy time to crush the insurgency. It has never been sincere in talks," said Farooq, who is also the region's top Muslim cleric.

"If the Indians think they can end the movement in Kashmir by crushing the insurgency, they are highly mistaken," he said.

The divided territory of Kashmir has sparked two of the three wars fought between India and Pakistan since their independence from Britain in 1947, and an insurgency against Indian rule began in the state in 1989.

A peace process was launched by the two nuclear-armed neighbours in 2004, and although violence has dipped significantly on the ground there has been scant progress on issues such as troop reductions.