This development comes after Chief Minister Omar Abdullah had recently proposed that a new surrender and rehabilitation policy should be formulated for such youths.
Speaking to reporters, Home Minister P Chidambaram said, "The idea of granting amnesty to Kashmiri youth in PoK (Pakistan-occupied Kashmir) has been accepted. The idea must be translated into action now."
"Those Indians who had crossed over to PoK and now wish to return to India are certainly welcome," he said.
Chidambaram said, "PoK is actually an Indian territory and we should facilitate their return."
The home minister said the government would hold discussions with various political parties on the issue.
"Process of wider consultation would be carried and we will consult leader of the opposition and two main political parties in Kashmir," he added.