Colombo, Mar 7 (IANS): The police on Wednesday extended curfew for the third consecutive day in Sri Lanka's central district of Kandy after Buddhists and Muslims clashed on the streets resulting in two deaths and injuries to several people.

Clashes erupted on Sunday in the central part of the country leading to the deaths, torching of around 20 shops and a dozen arrests, after a Buddhist man was reportedly killed by a group of Muslims.

Police spokesman S.P. Ruwan Gunasekera told Xinhua news agency that the curfew, which was imposed on Sunday night, had been extended until further notice as several violent incidents had been reported from across Kandy district.

Eye witnesses on the ground said the police were forced to fire in the air on Tuesday night to disperse mobs who took to the streets, defying the curfew and state of emergency.

Gunasekera said tight security remained in place and special police teams had also been dispatched to Kandy.

"There is a heavy presence of police, special forces and the Army on ground. There have been several incidents which is why the curfew has been re-imposed," Gunasekera said.

So far, police have arrested more than seven individuals involved in triggering the clashes on Tuesday night.

Businesses and schools across the district remained shut.

Due to the escalation of violence, President Maithripala Sirisena on Tuesday declared a 10-day, nationwide state of emergency, the first since the country ended a civil war in 2009.

In a nationwide address, Sirisena appealed for calm and peace and warned of "stern action" against anyone spreading violence and rumours with the intention of provoking communal violence.

Several ministers also visited Kandy, urging people to refrain from violence and maintain law and order.

Violent clashes erupted in Digana town in Kandy on Sunday night after the death of a Buddhist in Teldeniya, who was killed when he clashed with four Muslims on February 22.

Gunasekara said 24 people had been arrested over the killing so far. Out of the 24, 10 were directly involved in the killing of the victim while 14 people were arrested on suspicion.

The body of a 28-year-old Muslim man was also recovered in Kandy province. His house was allegedly set on fire by Buddhist radicals. The man got trapped inside the house after helping his parents escape the fire.