An Indian state government Wednesday approved legislation banning superstition and black magic, an official said, a day after a prominent champion of the bill was shot dead.

Atheist Narendra Dabholkar, who for years campaigned for such a law, was killed on Tuesday by two gunmen on motorbikes as he was taking his morning walk in Pune city in the western state of Maharashtra.

Maharashtra's cabinet on Wednesday approved the law which was first mooted back in 1995, a state official told AFP, adding that state parliamentary approval was now required.

"An ordinance will be promulgated in the next two days," the official said, declining to be named.

News on the legislation came amid a strike in Pune on Wednesday to protest at Dabholkar's killing, which saw 90 percent of the city's businesses and shops close, police commissioner Gulabrao Pol told AFP.

"There is no progress" on the investigation into his death, he added, saying no arrests had been made and the motive had not been determined.

Further protests were held in the state capital Mumbai.

The Maharashtra Prevention and Eradication of Human Sacrifice and Other Inhuman, Evil Practices and Black Magic Bill was designed to outlaw several exploitative activities by charlatans preying on the vulnerable.

Details were not yet available but an earlier draft proposed bans on beating a person to exorcise ghosts and on raising money by claiming to work miracles.

Dabholkar, who founded the Committee for the Eradication of Blind Faith two decades ago, encountered opposition over the bill from Hindu nationalists who feared it could be used to curb religious freedoms.

In an interview with AFP two years ago, the campaigner rejected charges that such a bill was anti-religion.

"In the whole of the bill, there's not a single word about God or religion. Nothing like that. The Indian constitution allows freedom of worship and nobody can take that away," he said.

"This is about fraudulent and exploitative practices."

Superstitious beliefs are rampant in fast-developing and officially secular India, where Hinduism dominates but a diverse range of ethnic groups and religious practices co-exist.

Some rationalists believed the proposed law did not go far enough, having been watered down to appease pro-Hindu groups.

Dabholkar, whom local media said was aged 71, also took on some of India's self-styled Hindu "godmen" over their claims to have performed miracles.

He was cremated about 100 kilometres (62 miles) from Pune in his home town of Satara late on Tuesday, the Press Trust of India news agency reported.