India has summoned the Pakistani ambassador as Prime Minister Narendra Modi vows to exact a "heavy price" over deadly attack in Kashmir.

Iran Press/Asia: India's Prime Minister Narendra Modi has promised a "strong response" to a car bombing in Indian-administered Kashmir that killed at least 42 paramilitary personnel, with New Delhi calling for "the complete isolation of Pakistan" for harboring the armed group behind the devastating attack.

"If our neighbor thinks it can destabilize India, then it is making a big mistake," he was quoted as saying by the Indian Express newspaper.

Thursday's attack was claimed by the Pakistan-based Jaish-e-Mohammad (JeM) soon after a Kashmiri rebel rammed an explosive-laden car into a bus carrying personnel of the Central Reserve Police Force (CRPF).

The bombing has ratcheted up the tension between the two South Asian neighbors, which rule parts of Muslim-majority Kashmir while claiming the entire territory as their own.

Pakistan has denied any involvement and warned India against linking it to the attack.

Meanwhile, as outrage and demands for revenge flooded Indian social media, the country's Foreign Secretary Vijay Gokhale summoned Pakistan's envoy Sohail Mahmood and served a diplomatic notice demanding Islamabad take action against JeM.

In Kashmir's Jammu region, thousands of protesters held anti-Pakistan demonstrations and set fire to vehicles, prompting police to impose a curfew.

Hundreds of security forces guarded the streets as residents remained indoors “fearing a backlash from the forces".

Islamabad has rejected India's suggestion it was linked to the attack, which it called a matter of "grave concern".

"We strongly reject any insinuation by elements in the Indian government and media circles that seek to link the attack to the State of Pakistan without investigations," Pakistan's Ministry of Foreign Affairs said in a statement. 101/ 211 /205

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