indian soldiers
© REUTERS/Danish Ismail
Suffering defeats in the Middle East, Islamic State may now eye India, setting up underground cells in various states of the world's second-largest country, a local intelligence agency has reportedly warned.

India has become increasingly vulnerable to the threat of Islamic State-inspired (IS, formerly ISIS) terrorist attacks, according to NDTV, citing three intelligence letters sent to police chiefs in the state of Kerala.

"After loss of territory in Iraq and Syria, IS is urging operatives to take up violent forms of jihad while staying back in their respective countries," reads one of the letters.

The terrorist group may also target key installations in Kochi, Kerala's most populous city with 2 million people, another letter says. Local police officials estimate that roughly 100 Kerala residents have joined IS in the past few years, while around 3,000 have been "deradicalized"and are now under surveillance.

The southern state lies close to Sri Lanka, where terrorist attacks in April resulted in the deaths of over 250 Christians celebrating Easter.

The news comes after an Islamic State-affiliated mouthpiece reportedly announced the creation of the 'Wilayah al-Hind', or 'Indian Province'. Shortly afterwards, the terrorist group said it had established an additional stronghold called 'Wilayah Pakistan'.

IS once wreaked havoc in Syria and Iraq, where it established a 'caliphate' and enforced strict sharia rules. Now, the group is declining in the region following successful campaigns by Syrian government forces backed by Russia and the US-supported Iraqi military.