A landmine blast earlier in the day wounded at least eight people, including four soldiers, in Baramulla town, according to police.
Both sides described the talks in New Delhi between the Indian foreign secretary Shiv Shankar Menon and his Pakistani counterpart, Riaz Mohammad Khan, as "very constructive and positive".
The two are expected to set up a joint system to combat terrorism and also push new moves to build trust.
The dialogue comes a few months after Indian and Pakistani leaders agreed to resume negotiations after meeting on the sidelines of a Non-Aligned Movement (NAM) summit in September.
"A considerable amount of time was spent discussing terrorism," a spokesman for the Indian foreign ministry, Navtej Sarna, told a news conference.
Sarna said the two teams also reviewed a series of measures to build trust, such as cross-border transport links, bilateral trade, civilian prisoners in each other's custody, security and the Kashmir dispute.
India had suspended the dialogue with Pakistan after blaming Pakistan's spy agency and an Islamist group based there, Lashkar-e-Taiba, for the Mumbai bombings that killed 186 people.
New Delhi says Islamabad has not done enough to curb anti-India militants based in Pakistan. Islamabad says separatist violence will cease when the Kashmir dispute is settled.
The New Delhi talks are also expected to discuss ending a stand-off over the Siachen glacier in Kashmir.
But progress is unlikely as the Indian army is unwilling to withdraw troops from what is the world's highest battleground.