The convoy was fired at from both sides of the road near Classic Hospital this evening, police said, adding that the militants fired over a dozen rounds.
Three jawans sustained bullet wounds in the attack and their condition was "critical", police said.
Militants fled from the spot in a tinted car. A motorcycle, possibly used by the ultras, has been recovered.
Army troops immediately cordoned off the area and a massive hunt has been launched to nab the militants involved in the attack, police said.
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The brazen attack came even as security has been beefed up across the Valley in view of Prime Minister's two-day visit.
PMO sources in Delhi said that there was no change in Singh's programme.
The Prime Minister is scheduled to reach here tomorrow along with UPA Chairperson Sonia Gandhi on a two-day visit, during which he is expected to announce a package for border districts of Jammu and Kashmir.
Singh and Gandhi will also launch train service on a railway section between Qazigund in Kashmir and Banihal in Jammu region that will provide an all-weather link to the Valley.