Thousands are sleeping in shelters near the de-facto border in Kashmir, as Indian and Pakistani border troops trade regular fire across the border of the disputed Himalayan territory.

The two sides were exchanging gunfire and shelling until dawn on Thursday, just hours after their commanders met face-to-face in an effort to defuse escalating tensions that flared earlier this week.

Indian civilian official Shantamanu said that, at one point, 15,000 people were sleeping in government buildings temporarily converted to accommodate those fleeing the violence.

Many had returned to their homes by Thursday, but 2,000 were staying because they were afraid.