Indian police say they have shot dead two suspected Islamic militants in one of the most prestigious shopping centres in Delhi.

Officers said they were acting on intelligence that a terrorist attack was being planned to coincide with Diwali - the year's main Hindu festival which starts on Monday.

Diwali - the festival of light - is enjoyed as one of Hinduism's great festivals

They intercepted the suspects in the basement of the Ansal Plaza shopping centre, sparking a shoot-out.

The dead men are believed to be members of the Lashkar-e-Toiba group which has been blamed for an attack on the Indian parliament late last year.

A BBC correspondent in Delhi said the shopping centre was packed with people enjoying themselves and making final preparations for Diwali - the festival of light.

Weapons including automatic rifles were recovered, police said.

Separatist violence

Lashkar-e-Toiba is an armed separatist group which opposes Delhi's control of part of Kashmir.

This weekend has also seen a new spate of violence in Kashmir itself as a new chief minister was inaugurated for the Indian-administered part of the region.

Lashkar-e-Toiba - which has even said it wants Islamic rule for the whole of India - was blamed for the December 2001 attack on the Indian parliament building in which nine police officers died.

India blamed Pakistan for backing the militants and the row heightened tensions between the two nuclear-armed powers who sent one million troops to face each other along their border.

Six months ago, Indian police shot dead two other suspected members of the separatist fighters, again in Delhi.

They said one of them was believed to have taken part in an attack on Delhi's Red Fort in December 2000 when two soldiers and one guard were killed.