India has accused Pakistan's army of involvement in a deadly ambush on its troops in Kashmir, after angry opposition members claimed New Delhi was going soft on Islamabad.

Defence Minister A K Antony hinted at stronger military action along the Line of Control (LOC) where the ambush overnight on Monday saw five Indian soldiers killed, signalling a setback to warming relations between the neighbours.

"It is now clear that the specialist troops of Pakistan army were involved in this attack," Antony told parliament on Thursday.

"Nothing happens from Pakistan's side of the LOC without the support, assistance, facilitation and often direct involvement of the Pakistan army," he said.

"Naturally, this incident will have consequences on our behaviour on the LOC and for our relationship with Pakistan," Antony said.

The picturesque Himalayan territory of Kashmir is divided between India and Pakistan by the UN-monitored LoC, the de facto border, but is claimed in full by both countries.

Pakistan denies role

Pakistan has denied any part in the incident, but India has lodged an official protest with Islamabad for what is one of the worst losses of life for the Indian army since a 2003 truce agreement.

India has fought three wars with Pakistan, two over the Muslim-majority region of Kashmir.

A deadly flare-up along the LoC in January brought low-level peace talks to a halt. They had only just resumed after a three-year hiatus sparked by the 2008 attacks in Mumbai that killed 166 people. India blamed Pakistani-based armed groups for the attack.

More than a dozen armed rebel groups have been fighting Indian forces since 1989, demanding independence for Kashmir or a merger with Pakistan.