The Union Home Ministry also asked the state government to ensure that no such incident takes place in future and deploy CRPF in prison security.
"The home ministry has taken serious note of the issue and has advised the state government to fully review security measures and take action to prevent such incidents in future," a senior home ministry official told PTI.
The move came following a high-level meeting which was convened after the escape of Pakistani terrorist Naveed Jatt, who was lodged in Srinagar central jail.
He fled from a hospital in the city after some terrorists shot and killed two policemen accompanying him.
Jatt was taken to the hospital for medical checkup.
The home ministry has asked the Jammu and Kashmir government to fix responsibility for lapses and also to examine why a high-security prisoner was sent to the OPD of a hospital.
There were 16 Pakistani prisoners still in Srinagar jail, of whom seven are being shifted to Jammu and discussions are on where to shift the others.
The state government has been asked to involve CRPF in all aspects of central jail security -- not only perimeter security but also inside the prison.
Another official said that the Jammu and Kashmir government has assured the central government of taking necessary steps and reviewing the entire jail security.
Consequently, the state government has transferred Director General of Prisons SK Mishra and appointed Dilbag Singh in his place.
The Srinagar jail superintendent has been suspended and a high-level enquiry by the divisional commissioner ordered, the official said.