(updates with toll, militant claim)

SRINAGAR, India, July 19 (Reuters) - At least nine Indian soldiers were killed and 16 wounded on Saturday when their vehicle detonated a landmine in the biggest attack on Indian soldiers in recent months.

Their army bus was blown up near Kashmir's main city, Srinagar, two days ahead of a new round of India-Pakistan peace talks opposed by Kashmiri separatist militants.

Kashmir's frontline rebel group, Hizbul Mujahideen, claimed responsibility for the attack. A caller who identified himself as Ehsan Elahi, spokesman of Hizbul Mujahideen, told Reuters more than two dozen soldier had been killed.

Witness Imtiyaz Ahmad Bhat said a "powerful explosion shook the whole area, many injured were screaming for help".

An Indian defence ministry spokesman, Lieutenant-Colonel A. K. Mathur, said nine soldiers had died. "Some of the injured are in critical condition," he added.

Violence involving Indian troops and separatist militants has declined since a peace process began in 2004 between India and Pakistan, who both claim Kashmir and have fought two wars over the Himalayan region.

But people are still killed in daily shootouts and occasional bomb attacks that security agencies have warned will rise ahead of local elections due later this year.

On Friday more than 30 people, including 10 children, were wounded when suspected separatist militants lobbed a grenade near a crowded bus stop in south Kashmir.

Officials say more than 43,000 people have been killed since the revolt against New Delhi's rule broke out in 1989. Human rights groups put the toll at about 60,000 dead or missing. (Reporting by Sheikh Mushtaq, Editing by Douglas Hamilton) (For the latest Reuters news on India see: http://in.reuters.com for blogs see: http://blogs.reuters.com/in/)

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