One person was killed and eight injured in an encounter between militants and security forces barely a few kilometres from the Sher-e-Kashmir International City Centre in Srinagar, where Prime Minister Atal Bihari Vajpayee addressed the eighth Inter-State Council meeting on Wednesday.

The militants, who were said to be two, tried to storm the heavily guarded headquarters of the Bharat Sanchar Nigam Limited, police said, adding they hurled a grenade and opened fire from automatic weapons.

The militants were forced to take shelter in an adjacent building after encountering retaliation from Central Reserve Police Force guards, they said.

Border Security Force personnel and police were rushed to the site, where a cordon was laid.

The person who was killed was a BSF jawan and one of the injured was the force's Deputy Inspector General (Operations), Desh Raj.

The officer, who sustained a bullet injury in his chest, was taken to a hospital and was said to be critical, sources said.

Inspector General of Police (Kashmir Range) K Rajendra escaped when the militants fired in his direction, but his security guard received serious injuries.

The encounter was on when reports last came in.