The picture – showing a fresh-faced young man leaning nonchalantly against a tree – has been circulating on social media and mobile phones for months. But the smiling 17-year-old, Burhan Muzaffar Wani, a keen cricketer and successful student, is carrying an assault rifle, not a bat, and the bag at his feet does not contain notebooks.

One of a new wave of young, educated separatist militants active in the Indian-administered parts of Kashmir, Wani has much support in his village of Tral, a cluster of traditional homes and mosques amid green fields and woods in a fold of the dry hills in the south of "the valley", as the most famous, richest and strategically important part of the disputed Himalayan former princedom is known.

"Everyone in the village supports Burhan," said a friend, requesting anonymity for fear of detention by security forces as a militant sympathiser.

Kashmir, which was split between Pakistan and India after the countries gained their independence from the UK in 1947, still makes headline news. Seven towns in the Indian portion are under an indefinite curfew following sporadic clashes between local Hindus and Muslims that have killed three people, officials said.

Last week, India accused Pakistan of sending commandos to kill five of its soldiers stationed on the line of control, the de facto border dividing the two parts of Kashmir.

But overall levels of violence are lower now in Kashmir than at any time since an insurgency that pitted groups of young Muslim Kashmiris enrolled in Islamist groups, and later extremists from Pakistan too, against Indian security forces first flared more than two decades ago. In total, more than 50,000 militants, soldiers, police and civilians are thought to have died in the fighting in India's only Muslim-majority state. Human rights abuses have been perpetrated by all sides.

At its height in 2001, 4,500 deaths were recorded, according to the Institute for Conflict Management, a Delhi-based thinktank. Last year, only 117 people were killed.

And though there have been spectacular attacks against military targets and scores were injured in rioting in July after four protesters were shot dead by security forces, officials in Srinagar, Kashmir's summer capital, say there are now no more than 200 militants operating in the valley, whereas at the peak of the insurgency there were up to 20 times as many.

The unrest that has often paralysed cities and the economy in recent years has almost died away. Tourists now throng the houseboats on Dal lake or make pilgrimages to Hindu holy sites.

"I have never been worried while here. The image of Kashmir elsewhere in India is totally wrong," said Meha Sao, from the southern state of Maharashtra, on holiday in Srinagar.

Nor, despite the sentiments expressed by the friend of Wani the militant, is support for violence as widespread as it once was. "You do find some local support in pockets but these pockets have shrunk dramatically, which is why it is so difficult for the militants," said Omar Abdullah, the chief minister.

A militant hardcore still exists, particularly in southern areas such as Tral. And even if less numerous, the new militants appear highly motivated. Wani is believed to have been involved in at least one of the recent attacks on security forces.

Tral village is tense. After three militants and a policeman were killed in a recent clash nearby, leaders of Hizb-ul-Mujahideen, the group Wani is believed to have joined, warned locals to stay away from security personnel, whom they planned to target.

Observers say the new recruits to militancy are different from volunteers over the past 20 years. They are younger and better educated. Wani is one of the youngest. His father, Muzaffar Ahmed Wani, 50, said his son had left home overnight two years ago to join the militants, aged just 15. "He said nothing to anyone. He just said he was going out and didn't come back," he said.

Though pious and brought up in a family that is supportive of the extremists, Wani had shown no sign of wanting to take up arms until he was detained and beaten by security forces, his father, the head of a local college, said.

Dal lake, Srinagar, in the Kashmir 'valley'. Photograph: Rouf Bhat/AFP/Getty Images

"He was thinking of revenge only for 15 days after being released. So he got in contact with the militants. Or maybe they heard about him and got in touch. Then he went. It was only 10 days before his exams. But I am proud of him," his father said.

It is almost certain that Wani will be killed. Few active militants surrender. Most prefer to die when cornered by security forces. "We are ready for him to die," his father said. "We are facing oppression every day. I look around and I see only ashes. There is only less violence because there is a lack of faith. Anyone with true faith joins the militants."

'We are not scared of death, we are just scared of detention'

Three hours' drive to the north, in the tough town of Sopore, the family of Muzamil Amin Dar have already faced what Wani has accepted is inevitable.

Dar, 26, was killed last October. Accounts of how and why he had joined the extremists differ. His family says Dar, a college graduate who had landed a highly paid job as a hospital medical technician with a monthly salary of £200 seven months before going underground, was not interested in radicalism.

This changed, they say, after his detention by security forces when guns were found in a well in the Dars' garden. Police say he was a member of the Pakistan-based Lashkar-e-Taiba group, one of the most violent organisations operating in the valley, for five years, was the mastermind of a Delhi bomb plot and was wanted for several local militant attacks including the killing of a policeman.

Over recent years Dar had become increasingly devout. He had stopped his father, an electrical repair man, from watching television and convinced another brother to leave a bank job which, Dar said, involved usury.

"Once I was watching a cricket match and he unplugged the television and shouted at me not to waste my time on trivial things," Dar's father, Mohammed Amin, said.

After his son disappeared, there was no news. Then last October, the family heard firing only a mile from their home. A huge military operation was under way. Two militants armed with assault rifles and grenades were holed up in a house, they heard. Then they learned one was Dar.

Security forces asked Dar Sr to negotiate with his son but he refused, fearing they would kill him as he came out to surrender. After nearly 12 hours of shooting, his son, badly wounded, called him and told his father to "live life according to Islam".

He died the next morning when explosions brought down the house he and the other militant had hidden in. "We miss him a lot," his father said. A policeman and a paramilitary were wounded in the firefight.

Such encounters were once regular occurrences. Now they are rare. A senior Indian official in northern Kashmir said the extremist groups had been forced to change tactics in recent years because they lacked weapons.

"They have moved from insurgency to terrorism. But if they had thousands of guns they would have thousands of fighters," he said.

This, most analysts believe, is underestimating the degree to which decades of conflict have undermined support for militancy locally.

Some suggest that security officials in the disputed province exaggerate the threat from extremism to justify wide-ranging powers of arrest and detention – and a broad measure of immunity from prosecution for human rights abuses – granted early on in the conflict.

One factor is declining official support for the extremists in Indian Kashmir from Pakistan over the past decade. Another is the growing disparity between the economies of the two neighbours, which have fought three wars over the state. Indian growth has undermined the argument for accession to Pakistan in Kashmir – though much rhetorical support for independence remains – and sapped enthusiasm for any return to a hugely disruptive violent struggle.

However, Abdullah, the chief minister, said economic development was only a partial solution. "You will always be plagued by the reality that there is a political issue that formed the basis for this trouble and it will have to be resolved, today, tomorrow, the day after, at some point," he said.

During a short bout of rioting in Sopore, a hotbed of insurgent violence in northern Kashmir, last month, young men spoke of their anger.

"We are not scared of death, we are just scared of detention, for our families," said Shakeel Ahmed, a 24-year-old pharmaceutical representative, before returning to throw stones at the police. "The level of militancy is low now, it is true, but it will rise, God willing."