MUZAFARABAD, Pakistan (AP) — India and Pakistan exchanged gunfire through the night into Thursday morning in the disputed Himalayan region of Kashmir, a day after Islamabad said it shot down two Indian warplanes and captured a pilot.There were no immediate reports of casualties, though jetfighters roared overhead through the mountainous region as villagers along the so-called Line of Control fled to safety.Meanwhile, members of Indian Prime Minister Narendra Modi’s Bharitiya Janata Party called for more military action, suggesting the conflict still could worsen. Pakistan’s Prime Minister Imran Khan had called for talks between the two nuclear-armed rivals in a televised address Wednesday, saying: “Considering the nature of the weapons that both of us have, can we afford any miscalculation?”World powers have called on the nations to de-escalate the tensions gripping the contested region since a Feb. 14 suicide car bombing killed over 40 Indian paramilitary personnel. India responded with an airstrike Tuesday inside Pakistan, the first such raid since the two nations’ 1971 war over territory that later became Bangladesh.The situation escalated with Wednesday’s aerial skirmish, which saw Pakistan say it shot down two Indian aircraft, one of which crashed in Pakistan-held part of Kashmir and the other in India-controlled Kashmir.India acknowledged one of its MiG-21s, a Soviet-era fighter jet, was “lost” in skirmishes with Pakistan and that its pilot was “missing in action.”India also said it shot down a Pakistani warplane, something Islamabad denied.Pakistan’s military later circulated a video of a man with a mustache who identified himself as the Indian pilot, sipping tea and responding to questions, mostly by saying, “You know I can’t answer that.” He appeared in good health as he was questioned about his hometown, his aircraft and his mission.Both Indian and Pakistani officials reported small-arms fire and shelling along the Kashmir region into Thursday. Government buildings in Muzafarabad, the capital of the Pakistan-controlled section of Kashmir, were used to provide shelter to those who fled from border towns.Indian army spokesman Lt. Col. Devender Anand described the intensity of the firing as “lesser” than previous nights.Authorities in Pakistani-controlled Kashmir closed all schools and educational institutions in the region and are urged parents to keep their children at home amid mounting tension with neighboring India. Pakistan’s airspace remained closed for a second day Thursday, snarling air traffic.Meanwhile, India’s finance minister, Arun Jaitley, suggested at a news conference Wednesday that Indian special forces carry out secret missions to capture terrorist leaders in Pakistan, invoking the 2011 U.S. Navy Seal operation to kill al-Qaida leader Osama bin Laden.”I remember when U.S. Navy Seals went to Abbottabad to kill Osama bin Laden, then why can’t India?” he asked. “This used to be only an imagination, a wish, a frustration and disappointment. But it’s possible today.”Just weeks before general elections are due in India, the head of Modi’s party in India’s Karnataka state, B.S. Yeddyurappa, said India’s pre-dawn airstrikes in Pakistan on Tuesday would help the party at the polls.The violence Wednesday marked the most serious escalation of the long-simmering conflict since 1999, when Pakistan’s military sent a ground force into Indian-controlled Kashmir at Kargil. That year also saw an Indian fighter jet shoot down a Pakistani naval aircraft, killing all 16 on board.Kashmir has been claimed by both India and Pakistan since almost immediately after their creation in 1947. The countries have fought three wars against each other, two directly dealing with the disputed region.___Hussain reported from Srinagar, India. Associated Press writers Ashok Sharma in New Delhi and Kathy Gannon and Munir Ahmed in Islamabad contributed to this report.