An estimated four million mobile phone subscribers, mostly having pre-paid services, are in the state where the security agencies, including the army, had initially expressed reservations against mobile phones amid fears that militants may misuse them.

Security forces are worried that they don't know the actual figures of how many such SIM cards have landed into the hands of terrorists even as the telecommunications department has restarted physical verification of customers' documents submitted to it by private operators.

But Telecom Enforcement Resource and Monitoring (TERM) Director T.K. Gupta refused to comment on the 'confidential matter'.

The racket was unearthed after a dozen people were arrested in connection with an IED explosion in Poonch district. Five people were killed in the explosion.

Eight SIM cards were seized. Police said two were issued by Pakistani phone operator Ufone, and six by an Indian operator in the names of army personnel and civilians.

Police said none of the six subscribers in whose name the SIM cards were allotted were aware that there existed another card in their name.

Earlier, police in the Kashmir Valley had unearthed a similar racket and found that militants had forged the documents of a senior army officer in north Kashmir's Baramulla district to get a SIM card which was used to explode an IED in which an officer was injured.

The use of mobile phones to explode IEDs is one of the easiest and widespread means of attacking security forces as the militant, who plants the IED at one place, can explode it from miles away.