Jammu and Kashmir Chief Minister Mehbooba Mufti on Monday said Prime Minister Narendra Modi intended to hold talks in a "conducive atmosphere" with all stakeholders to bring order to the troubled state as she invoked former Prime Minister Atal Bihari Vajpayee's policy, saying "talks" were the only way to "move forward".

Mehbooba Mufti met Modi here to review the worsening security situation as speculations gained momentum about the possibility of Governor's Rule in the state amid allegations that the PDP-BJP coalition government has failed to control law and order in the Kashmir Valley.

"We had talks during Vajpayee regime. We need to move forward from where Atalji had left. Till then there is no chance of improvement in the situation," Mufti said responding to reporters over possibility of talks with Hurriyat leaders.

"We need a dialogue. We can't be confronting our own people for too long. We cannot hold talks when from one side stones are being thrown and bullets are fired from the other," she added.

The Chief Minister added that Modi has vowed to work on the lines of Vajpayee, whose policy was of reconciliation and not of confrontation.

"Modiji has an intention of holding talks but before that a conducive atmosphere needs to be created," she told reporters after the meeting the Prime Minister at his 7, Lok Kalyan Marg residence.

"Everything is possible if atmosphere is conducive, and there is no way forward without talks," she said.

The Peoples Democratic Party chief said that after Vajpayee's initiatives, the Srinagar-Muzaffarabad road was reopened, talks began with the Hurriyat and the ceasefire on the Line of Control came into force.

"Something happened while Atalji was there. That is the reason, the people of Kashmir still remember Atalji. Due to this policy, there is an alliance between BJP and PDP."

"We held discussions on various issues...the agenda of alliance between the PDP-BJP," she said.

On possibility of Governer's rule in the state, Mufti said: "That is for the central government to decide."

She dubbed the recent rift in alliance as "bad", and said this should not have happened.

"The PDP stood by its 'dharma' but it's an internal matter and we will resolve it through talks," she said.

Mufti said her father, the late Chief Minister Mufti Mohammed Sayeed "had given a road map" for lasting peace in the state.

Mufti said she stressed on the Prime Minister to compensate people of the state for the losses they have suffered due to the Indus Waters Treaty between India and Pakistan.

She said she was confident of finding a solution to the festering trouble in the Kashmir Valley.

"We have a Unified Command meeting tomorrow (Tuesday). There are two-three kinds of people who are involved in stone pelting. Some are disillusioned and some are incited," the Chief Minister said when asked about how she would control the use of the social media that are inciting youths to pelt stones.

"We will find a line of action," she said.

Meanwhile, the Bharatiya Janata Party also denied any rift in the coalition and assured the Mehbooba Mufti-led government of its continued support.

"There is no rift in the BJP-PDP alliance," BJP General Secretary Ram Madhav told reporters.

Madhav is in charge of the BJP affairs in Jammu and Kashmir.

"We have extended all support to the state," he said.

According to him, the party's main concern is to bring "normalcy" in the Kashmir Valley within one-two months.

He said there was an issue regarding elections to the legislative council. "We have noticed a lack of communication on the issue and will address it."

On the other hand, senior Congress leader Ghulam Nabi Azad said peace won't be restored in the violence-hit state till the PDP-BJP government is in power.

"Peace won't be restored in Jammu and Kashmir as long as the coalition government is in power in the state. However, Governor's Rule is not the solution to the problem. The government should bring change in its approach," Azad told reporters.

Mehbooba Mufti later met Union Home Minister Rajnath Singh and discussed the security situation in the state.