PM Modi announced Rs 570 crore for rebuilding homes in Kashmir, and Rs 175 crore for six major hospitals worst affected by the floods.

"India shares the grief of Jammu and Kashmir. The government stands with the people in rehabilitation efforts," he said, also announcing that books and notebooks would be provided to thousands of schoolchildren.

PM Modi was received at the Srinagar airport by Chief Minister Omar Abdullah, who briefed him about the challenges of rebuilding the state and asked for financial assistance. The state has asked for a Rs 44,000-crore rehabilitation package.

PM Modi later went to the governor's house Raj Bhawan, where political groups met him and raised the recent border firing from Pakistan and the damage to villages in the region. This is his fourth visit to Jammu and Kashmir since taking charge in May and the second since the floods last month.

At Siachen this morning, the Prime Minister told jawans, "You make it possible for 125 crore Indians to celebrate Diwali happily. Your dreams and responsibilities are the responsibility of us all. The entire nation stands shoulder to shoulder with you."

Mr Modi is the first Prime Minister to visit Siachen in 10 years. Praising thousands of soldiers posted at one of the most inhospitable places on earth, he said, "If you don't see this glacier you can't imagine under what hostile weather and circumstance our jawans are serving the motherland."

He tweeted a series of pictures and messages from Siachen. "Wished President Pranab Mukherjee a very Happy Diwali from Siachen! Am sure this would be among the most unique greetings Pranab Da received,' he said in one tweet.

Ahead of the Prime Minister's visit, Pakistani troops fired with small arms at Indian posts in Ramgarh and Arnia sectors in violation of the 2003 ceasefire between the two countries.

Close to 300 died and more than 1.5 million people were affected by the floods in Jammu and Kashmir. Among those hoping that the Prime Minister's Diwali gesture would translate to action, is Habla Begum, who told NDTV that she had sent a letter to Mr Modi through speed post a month ago, requesting him to visit her shattered home.