SRINAGAR, India — Shops and businesses were closed in the disputed Himalayan region of Kashmir on Saturday to protest India's plan to build townships for Hindus who fled a rebellion in Muslim-majority areas. Local political leaders criticized the plan to house nearly 200,000 Hindus in new townships as a conspiracy to create communal division by separating the region's population along religious lines. The issue of returning Hindus sparks high emotion in the mostly-Muslim region. Many of the Hindus, known as Pandits, fled after a rebellion erupted in 1989 that they believed was aimed at wiping them out. Muslims in the region, long unhappy with Indian rule, deny that Hindus were systematically targeted, and say India instead moved them out in order to make Kashmir's freedom struggle look like Islamic extremism. “Kashmiri Pandits are part and parcel of our society. We will live together, but we will not allow separate townships for them,” said Mohammed Yasin Malik, who leads a political group pushing for independence from India. He compared the proposed townships to Israeli-type settlements, and said no one should be allowed “to turn Kashmir into another Palestine.” Kashmiri Muslims and Hindus lived together peacefully for centuries before a 1947 war between India and Pakistan left Kashmir divided between the two as they gained independence from Britain. Within a decade, however, divisions emerged as many Muslims began mistrusting Indian rule and demanding independence or a full merger with neighboring Pakistan. While the 1989 Muslim rebellion was largely suppressed, at least half a million Indian troops remain stationed in Kashmir, and anti-India sentiment still runs deep. This week's protests erupted after Indian Home Minister Rajnath Singh asked the region to set aside land for building new townships for Hindus migrating back to the Kashmir Valley. On Saturday, roads were almost deserted while businesses and schools shut down. Armed police and paramilitary soldiers in riot gear patrolled and laid razor wire at major intersections. Clashes broke out on Friday between stone-hurling anti-India protesters and government forces firing tear gas, leaving at least 20 people injured, including a photojournalist and eight policemen. Most Pandits have spurned previous resettlement plans that offered jobs and relocation funding. They demanded full security measures and a separate area set aside for them before they return. Seeking to quell the controversy, the top elected official in the Indian portion of Kashmir said Hindu migrants would be settled where they had lived before. “There will be no Israel-type clusters,” Mufti Mohammed Sayeed said. The home minister told reporters in New Delhi on Thursday, however, that the central government's plan remained unchanged. Experts said the government would be courting trouble by pursuing any plan to establish Hindu enclaves in the mountainous territory. The proposed settlements “will become walls of insecurity and hate,” said political science professor Noor Mohammed Baba at Kashmir University in Srinagar, adding that any pro-India party in Kashmir would lose voter support for endorsing such a plan. “In India too, it'll have dangerously divisive fallout,” he said. “There will be demands from many persecuted minorities like Christians and Hindus for separate homelands and protected enclaves.” — AP