Muzaffarabad: A Pakistani firebrand cleric on Wednesday praised a deadly Indian air base attack last month that threatened to scupper peace efforts between the nuclear rivals.

Hafiz Saeed, alleged mastermind of the 2008 Mumbai attacks and leader of the banned Jamaat-ud-Dawa (JuD) group, encouraged further violence following the air base assault in Pathankot that left seven Indian soldiers dead.

Saeed, who remains a free man, also lauded Kashmiri militant leader Sayed Salahuddin, who heads the United Jihad Council (UJC) that has claimed responsibility for the attack.

"You have only seen one attack on Pathankot. Matters could easily escalate."

Crowds at the rally shouted slogans including "The war will continue until the liberation of Kashmir" and "We are ready for jihad".

Indian officials believe another group -- the Pakistan based Jaish-e-Mohammed (JeM) -- was behind the siege.

Strategic analyst Ayesha Siddiqa told AFP Saeed's praise of Salahuddin could be part of a "deflection strategy" to steer blame away from JeM, and by extension Pakistan, where it is based.

The air base attack occurred just a week after Indian Prime Minister Narendra Modi paid a surprise visit to Lahore, raising hopes for peace between the two countries.

Further planned talks between the top diplomats of both countries that had been due in mid-January were subsequently postponed.

Saeed's freedom and his frequent calls for jihad against India irk New Delhi, which considers JuD -- a UN designated "terror organisation" -- to be no more than a front for Lashkar-e-Taiba (LeT), the militant group blamed for the 2008 Mumbai attacks that left 166 people dead.