Critics say presidential order, that came amid uproar in Parliament as well as a huge troop surge and phone and internet suspension in the restive valley, aims to change the disputed region's Muslim-majority demographics.
India's government has rushed a decree through parliament on Monday revoking the constitutional status of disputed Kashmir signed under the treaty of accession.
The presidential order came amid uproar in Parliament and a huge troop deployment in the region with internet and phone services suspended.
Indian Prime Minister Narendra Modi's Home Minister Amit Shah told members of the upper house that the government has also decided to split the disputed region into two union territories, Jammu and Kashmir, which will have a legislature, and Ladakh, which will be ruled directly by the central government without a legislature of its own.
Shah, said the long-standing rights that preceded India's independence from British rule in 1947 were "temporary."
Article 35A of India's constitution permits the local legislature in Indian-controlled Kashmir to define permanent residents of the region.
The article came into being in 1954 by a presidential order under the constitution's Article 370, which grants special autonomous status to Jammu and Kashmir state.
The law, Article 370 of the Constitution, forbids Indians outside the state from permanently settling, buying land, holding local government jobs and securing education scholarships.
Critics of such a measure say that in doing away with Article 370, the government hopes to change India-administered Kashmir's Muslim-majority demographics by allowing in a flood of new Hindu residents.
Pakistan condemned India's "illegal steps" and said that Islamabad will "exercise all possible options" regarding New Delhi's decision.
Kashmir is divided between India and Pakistan and both claim the region in its entirety.
TRT World's Neha Poonia reports.
How did Article 35A come about?
A 1927 order by the administration of the independent princely state of Jammu and Kashmir gave the state's subjects exclusive hereditary rights.
Two months after India won independence from British rule in August 1947, Maharaja Hari Singh, the then-ruler of Jammu and Kashmir, signed a Treaty of Accession for the state to join the rest of the union, formalised in Article 370 of the Indian constitution.
Then Governor-General and last Viceroy Lord Mountbatten backed his decision with an understanding that this would only be temporary accession prior to "a referendum or a plebiscite."
Under the accession terms, India's jurisdiction was to extend to Kashmir's external affairs, defence and communications.
Further discussions culminated in the 1952 Delhi Agreement, a presidential order that extended Indian citizenship to the residents of the state but left the maharaja's privileges for residents intact.
Authorities placed large parts of the disputed region under lockdown amid a massive troop build-up by India, which traded accusations of clashes with Pakistan at the de facto border.
The recent tensions started in the last 10 days after New Delhi deployed at least 10,000 troops, but a security source told AFP news agency a further 70,000 had been dispatched in what is believed to be an unprecedented level.
"As per the order there shall be no movement of public and all educational institutions shall also remain closed," the state government ordered for Srinagar, the capital of India-administered Kashmir, and surrounding areas, in a statement obtained by AFP.
"There will be a complete bar on holding any kind of public meetings or rallies during the period of operation of this order."
Universities, schools, and colleges in southern Hindu-dominated Jammu were ordered to be shut, and one district in that region was placed under lockdown.
Several other major districts of the Muslim-majority state were also placed under restrictions, local media reported.
How ironic that elected representatives like us who fought for peace are under house arrest. The world watches as people & their voices are being muzzled in J&K. The same Kashmir that chose a secular democratic India is facing oppression of unimaginable magnitude. Wake up India— Mehbooba Mufti (@MehboobaMufti) August 4, 2019
Private mobile networks, internet services, and telephone landlines were cut, with only the one government-owned mobile network remained operational.
A senior official told AFP nearly 300 administrative officials and top security officials had been issued with satellite phones.
Locals say they were worried that Indian Prime Minister Narendra Modi's right-wing government could set aside a constitutional provision –– Article 35A –– which would allow Indians from outside the disputed territory to purchase land there.
'Chili bombs' in old city
Before the networks were cut, pro-India Kashmiri leaders tweeted that they had been put under house arrest.
"I believe I'm being placed under house arrest from midnight tonight & the process has already started for other mainstream leaders," Omar Abdullah, a former chief minister of the region, tweeted.
Mehbooba Mufti, another former chief minister and Modi's former ally, said on Twitter it was "ironic that elected representatives like us who fought for peace are under house arrest. The world watches as people & their voices are being muzzled."
In downtown Srinagar, a local resident told AFP government forces threw "chili bombs" that affect respiratory systems, on empty streets.
Arresting two mainstream political leaders & former Chief Ministers, Modi has managed what previous Indian Prime Ministers had not been able to do before - Saying the world that #Kashmir is an Occupied Territory & India has no popular support in the Valley! #KashmirUnderThreat— Ashok Swain (@ashoswai) August 4, 2019
Islamic bloc reacts
A separate statement by the Organization of Islamic Cooperation (OIC) said it was "deeply concerned about the deteriorating situation in the Indian-occupied Jammu and Kashmir including reports of deployment of additional paramilitary forces and use of banned cluster munition by the Indian forces to target civilians."
The OIC General Secretariat decried reported civilian casualties "resulting from ceasefire violations carried out by Indian forces across the Line of Control and expresses solidarity with the people of Indian occupied Jammu and Kashmir," the statement added.
500,000 troops in tiny region
India maintains a deployment of 500,000 heavily armed troops in the tiny Himalayan region, which has been divided between the South Asian nation and Pakistan since their split in 1947.
The region was brought under New Delhi's direct rule in June 2018 after Modi's Bharatiya Janata Party (BJP) withdrew support for its local partner and dissolved the elected local government.
Since then elections for local assembly have been delayed and the region is under the rule of Indian president.
Resistance groups demand that Kashmir be united either under Pakistani rule or as an independent country in a UN-backed or sponsored plebiscite.
Anti-India sentiment runs deep in Kashmir's mostly Muslim population and most people support the rebels' cause against Indian rule.
Nearly 100,000 people have been killed in the armed rebellion and civil uprising and the ensuing Indian military crackdown since 1989.