Pakistan is accusing rival India of ambushing and killing at least two border security officers it says were invited for a routine meeting in Kashmir by their Indian counterparts, Reuters reported.
Islamabad summoned a senior Indian diplomat to lodge a "strong protest" over the incident, which began late Wednesday near the eastern Pakistani city of Lahore.
India, however, has accused Pakistan of initiating the incident, which it said killed an Indian soldier earlier in the day and prompted retaliatory fire from Indian border forces.
The border security force director, General D. K. Pathak, alleged Thursday that Pakistani troops targeted more than a dozen Indian outposts overnight after the Pakistan border guards were killed. Islamabad denied the charges.
The Indian officer said Pakistani forces "promised to end the firing, but surprisingly they began unprovoked mortar fire after midnight." He said the exchange of fire between the two nuclear-armed nations continued until Thursday morning.
Kashmir is claimed by both India and Pakistan. The two countries have fought two wars over control of the Himalayan region since they won independence from Britain in 1947.
Pakistan, which controls roughly one-third of the Himalayan territory, maintains that Muslim-majority Kashmir should have been included in its territory when British-ruled India was partitioned into independent India and Pakistan. India rejects that.
Other deadly skirmishes in in the area have fueled an already tense situation in recent months, despite a 2003 cease-fire.
The worst clashes took place in October when nine civilians were killed in India and nine in Pakistan. Thousands of villagers fled to safety on both sides.
List of nuclear holdings exchanged
Despite the border tension, the countries exchanged lists of their nuclear installations Thursday, complying with a bilateral agreement. The annual practice is aimed at prohibiting attacks against each others' nuclear facilities in the event of another war between the countries.
Under a separate pact, India and Pakistan also handed over lists of detained citizens each holds from the other country, mostly for crimes such as visa violations and inadvertent border crossings.
VOA's Ayaz Gul contributed to this report from Islamabad.