A police party attempted to remove encroachments on the road and sidewalks by the vendors between Regal chowk and Amirakadal in the nerve centre of Lal chowk around forenoon.
Irked by the police drive, the roadside vendors took to streets and blocked the main road using their handcarts and folding beds.
They also burnt trash at several places, causing tremendous hardships to people besides bringing the movement of traffic to a grinding halt for nearly four hours.
The protestors, however, dispersed after police suspended the drive and allowed the roadside vendors to continue with their business.
The police drive came at a time when business activities started picking up in the summer capital Srinagar and other major towns of the Valley ahead of the Eid-ul-Fitr festival.
"The drive was wrongly timed as shoppers have started flocking the markets to buy essentials, goods, gifts and other items for the festival," a teacher Abdul Rashid Bhat said.
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He said the drive should have been started at least a month ahead to ensure smooth movement of traffic and commuters during the festival days.
A senior police officer said the drive was launched following large-scale complaints against the footpath vendors.