The gunfight, which started on Tuesday evening and stopped during the night resumed Wednesday morning.
A policemen who was abducted by unknown gunmen from outside his house at Chetwatan, Shopian has been released in a near by area. The policemen who is being identified as Javeed was posted at Zakura.
An encounter broke out between security forces and terrorists in J and K's Shopian.
Two militants have been killed so far in the operation in Shopian, which was going on till the last reports were received, an official said. Two other terrorists were killed sometime later, during the encounter.
An encounter broke out between terrorists and security forces in Jammu and Kashmir's Shopian district on Tuesday. The security forces had launched a cordon-and-search operation in the Melhora area of Shopian district, following information about the presence of militants there.
The arrested duo have been identified as Zahoor Ahmad Koka and Uzair Ahmad Dar, both residents of Zainpora area in the district.
Two terrorists have been neutralised during an encounter with troops in Dairoo village of Jammu and Kashmir's Shopian District on April 17.
Kashmir Inspector General of police, Vijay Kumar commented on the Shopian encounter in which two terrorists were neutralised by security forces.
Two terrorists were killed in the encounter between security forces and terrorists in Jammu and Kashmir on March 09.
One of the terrorist body was recovered from Khojpura area after the shootout involving a team of Central Reserve Police Force (CRPF), the Jammu and Kashmir Police, and the Rashtriya Rifles.
A cordon and search operation launched by the security forces in Shopian on Friday led to a bust of a terror hideout. The operation that took place based on intelligence reports took place in Heff area of Shopian district of south Kashmir.
Jammu and Kashmir's DGP Dilbag Singh on January 20 informed that police neutralised three terrorists in an encounter including Hizbul Mujahideen's top commander in Shopian. "Today in Shopian, we neutralised 3 terrorists.
Three Hizbul Mujahideen terrorists, including a police deserter, were killed in an encounter with security forces in Shopian district of Jammu and Kashmir on Monday, police said.
Terrorists on Friday evening hurled petrol bomb at a school building in South Kashmir's Shopian district.
The family members refused to accept bodies and demanded compensation of Rs 15 lakh and a government job for the kin.