At least 14 Central Reserve Police Force (CRPF) troopers were injured in the blast after separatist guerrillas hurled a grenade at them on Thursday evening, police said.
The attack came barely two days before Prime Minister Narendra Modi's scheduled visit to the region to address a rally.
"Seven more injured CRPF troopers have been admitted to hospital with splinter injuries. Seven troopers were earlier admitted to hospital after militants lobed a grenade at a picket of the CRPF outside the Ikhwan Hotel in Khanyar area here," a senior police officer told IANS. "The area has been cordoned off to search for the militants".
CRPF officials told reporters that it was "a low intensity explosion".
Thursday's grenade attack occurred amid despite heightened security in the city ahead of the Modi's public rally here on November 7.
Scores of police and CRPF personnel have been deployed in the city to prevent any disruption of peace ahead of the Prime Minister's visit.