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Many of the Sikh protesters have been armed
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The Indian prime minister has appealed for calm amid confrontations between thousands of Sikhs and followers of the Dera Sacha Sauda (DSS) religious sect.
Manmohan Singh said he hoped nothing would be done "to flare up tempers".
One person has been killed and dozens injured in clashes between followers of the two religions.
Sikhs say the DSS leader has insulted their religion by appearing in an advert dressed as one of their most revered leaders, Guru Gobind Singh.
Thousands of police and military reinforcements have been sent to Punjab and Haryana states to try the prevent the violence from spreading.
'No imitation'
"I appeal to the people of Punjab and Haryana to maintain calm," Prime Minister Singh, India's first Sikh prime minister, told journalists in the capital, Delhi.
"The situation should not be allowed to go out of control."
The trouble has been brewing for days
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DSS leader Gurmeet Ram Raheem Singh has denied trying to look like Guru Gobind Singh, the 10th guru of Sikhism, in the newspaper advert.
"I have not imitated anyone. I won't hurt anyone's feelings," he said in a statement.
Tensions began rising earlier in the week. By Thursday, tens of thousands of Sikhs, many armed, had taken to the streets.
There have been clashes across Punjab and neighbouring Haryana state and even parts of Rajasthan.
A meeting of political parties in Punjab is now expected to take place to try and resolve the issue.
The DSS has its strongest following in southern Punjab. Most of its followers are Dalits, low-caste Hindus, but it also has Sikh, Muslim and Christian adherents.
Observers say this makes it hard to classify by normal religious groupings. The DSS is also politically influential.