It is the first full, formal ceasefire between the two since insurgency began in Indian administered Kashmir in 1989.
The two armies that exchange small-arms and artillery fire almost daily will observe the truce along the international border, the Line of Control dividing Kashmir between them and the frontier along the Siachen Glacier, said a statement from India's External Affairs Ministry.
"Directors-general of military operations of India and Pakistan, in the course of their weekly conversation today, agreed to observe a ceasefire with effect from midnight tonight," said the statement.
In Islamabad, Pakistan Foreign Ministry spokesman Masood Khan confirmed that the two countries' militaries had agreed on the ceasefire, which he said was indefinite.
The Siachen Glacier is the world's
"Our intent is for an indefinite period," Khan said. "This definitely is a positive development."
From his side, Indian Foreign Secretary Kanwal Sibal on Tuesday hailed the fresh peace moves by Pakistan, saying they could lead to dialogue between the arch-rivals.
"I think what the Pakistan side has done is very encouraging.
The latest announcement came a day after India welcomed Pakistan's unilateral ceasefire along the volatile frontier dividing Kashmir, called the Line of Control. Pakistan later clarified that it also would stop firing along the line that divides the two countries in the high Himalayan Siachen Glacier.
All this is very good and will enhance people-to-people contacts between the two countries," Sibal told reporters on the sidelines of the World Economic Forum's India Economic Summit.
The reference to the international border, the rest of the frontier that divides the two countries along several western and northern states, was added on Tuesday.
India said on Monday that a lasting ceasefire depends on Pakistan ending the infiltration of armed fighters into India's portion of Kashmir.
India has accused Pakistan of using artillery fire as a cover to help fighters sneak into Jammu and Kashmir to attack government forces and civilians. Pakistan denies the charge.