India said on Thursday it had conducted “surgical strikes” on suspected militants preparing to infiltrate from Pakistan-ruled Kashmir, marking an escalation in tensions between the uneasy and nuclear-armed neighbors.

Pakistan said two of its soldiers had been killed in in an “unprovoked” attack and in repulsing an Indian “raid”, but denied India had made any targeted strikes across the de facto frontier that runs through the disputed Himalayan territory of Kashmir.

Lieutenant General Ranbir Singh, the director-general of military operations, announced news of the strikes in New Delhi — which sent shares on the Indian stock market sliding nearly two percent.

The announcement followed through on Prime Minister Narendra Modi’s warning that those India held responsible “would not go unpunished” for a Sept. 18 attack on an Indian army base at Uri, near the Line of Control, that killed 18 soldiers.

“Some terrorist teams had positioned themselves at launchpads along the Line of Control,” Singh told reporters, describing the intelligence information as “very specific and credible”.

“The Indian army conducted surgical strikes last night at these launchpads. Significant casualties have been caused to these terrorists and those who are trying to support them.

“The operations aimed at neutralizing the terrorists have since ceased.”

Singh said the decision to launch the strikes had been taken after the military determined the launchpads had been set up with “an aim to carry out infiltration and terrorist strikes in Jammu and Kashmir and various other metros in our country.”

A senior government source said commandos flown in by helicopter carried out the strikes some way across the unofficial border known as the Line of Control (LoC).

The strikes raise the possibility of a military escalation between nuclear-armed India and Pakistan that would wreck a 2003 Kashmir ceasefire.

India’s disclosure of such strikes was unprecedented, said Ajai Sahni of the Institute for Conflict Management in New Delhi, and sent a message not only to his own people but to the international community.

“India expects global support to launch more focused action against Pakistan,” Sahni told Reuters. “There was tremendous pressure on the Indian prime minister to prove that he is ready to take serious action.”