Haseena Akhter, in her forties, was fighting elections in her village of Pakherpora, 35 kilometres (22 miles) from Kashmir`s summer capital, Srinagar.
The Panchayat or local body elections, which began on April 13, are being held in two phases in the revolt-hit Muslim-majority state after a gap of 10 years.
"Akhter was dragged out by unidentified gunmen who raided her residence on Friday night and killed her in the compound at point-blank range," a senior police officer told AFP, requesting anonymity.
Separatist political leaders and militant groups have called for a boycott of the local polls, terming the exercise an attempt by India to "strengthen its occupation of Kashmir".
A separatist insurgency has raged against New Delhi`s rule in Indian Kashmir for over 20 years. Militant attacks normally increase after the winter ends in the Himalayan region.
The killing of Akhter comes a day after a top army commander warned of possible new attempts by militants to infiltrate from neighbouring Pakistan as the snow melts in the mountain passes.
Nuclear-armed India and Pakistan, which have fought two of their three wars over Kashmir, each hold the Kashmir region in part but claim it in full.
At least 47,000 people have died as a result of the insurgency in highly militarised Indian Kashmir, according to official count, including security forces, political leaders and civilians.(*)
KR-IFB/H-RN
Editor: Jafar M Sidik
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