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Indian commandos were battling into early

MUMBAI (AFP) - Indian commandos were battling into early Saturday to end an assault on Mumbai by suspected Pakistan-based Islamic militants that has left up to 155 dead, among them foreign hostages.

Security forces were fighting it out inside the city's historic Taj Mahal hotel, where a tiny group of heavily armed gunmen where engaged in a fight to the death as the more than 52-hour-old battle entered its final stage.

Earlier, elite troops abseiled from helicopters and stormed a Mumbai Jewish centre and killed two gunmen -- only to find five dead Israeli hostages, including a US-based rabbi and his wife.

National Security Guard chief J.K. Dutt said the captives had been murdered by the gunmen during the commando assault.

The other five-star hotel that was attacked -- the Oberoi-Trident -- was declared clear of militants, with scores of trapped guests rescued and 24 bodies found.

"They were the kind of people with no remorse -- anybody and whomsoever came in front of them they fired," an Indian commando leader said of the young gunmen who slipped into India's economic capital on Wednesday evening.

We could have got those terrorists but for so many hotel guests," he said.

Indian media reports said up to 155 people were dead and 327 others wounded. TV channels described the carnage as "India's 9/11."

Around 18 foreigners were among the dead, including the Israelis, two Americans, two French nationals, a German, a Japanese, a Canadian, an Australian, a British Cypriot, an Italian and a Singaporean.

Nine militants were confirmed dead and one captured. Indian intelligence sources said the detained gunman had confessed to coming from Pakistan, and that the attackers had pre-positioned arms and explosives in one of the hotels.

A government minister said the overall toll could rise further as more corpses are recovered.

"Once the bodies are collected, the number of deaths might go up to 200," India's Minister of State for Home Affairs Sri Prakash Jaiswal told the Press Trust of India.

For the first time, the Indian government directly blamed arch-rival Pakistan for the militant attack.

"According to preliminary information, some elements in Pakistan are responsible ," Foreign Minister Pranab Mukherjee said.

A number of Indian officials suggested the militants were from the Pakistan-based Lashkar-e-Taiba -- notorious for a deadly assault on the Indian parliament in 2001 that almost pushed India and Pakistan to war.

Pakistani Prime Minister Yousuf Raza Gilani said his country had "nothing to do with the attacks in Mumbai," and Pakistan's foreign minister appealed to India not to get "sucked" into a blame game and put the arch-rivals on a dangerous path to confrontation.

Nuclear-armed India and Pakistan have already fought three wars since their independence from British rule in 1947.

Survivors have given terrifying accounts of the carnage in the hotels. Many said they hid in the dark for hours, barricaded in rooms or hiding under beds, inside wardrobes or bathrooms.

"I cannot believe what I have seen in the last 36 hours. I have seen dead bodies, blood everywhere and only heard gunshots," said Muneer Al Mahaj after he was rescued.

South African security guard Faisul Nagel was having dinner with colleagues at a restaurant in the Taj hotel when the assault began. They barricaded the restaurant and moved everyone into the kitchen.

"We basically put the lights off in the restaurant just to create an element of surprise. And we armed ourselves with kitchen knives and meat cleavers," he told AFP.

They ended up helping around 120 people escape -- including a 90-year-old woman who had to be carried in her chair down 25 flights of stairs.

Witnesses also said the attackers had specifically rounded up people with US and British passports.

Both the United States and Britain expressed condolences and offered to help investigate the assault on Mumbai, which has been hit by terror attacks before. Nearly 190 people were killed in train bombings in 2006.

"It is clear that we have got to help the Indian government deal with this terrorist incident and we have sent people from the Metropolitan Police to help," British Prime Minister Gordon Brown said.

India's newspapers laid much of the blame at the door of the intelligence agencies, which they said had failed spectacularly in allowing a handful of gunmen to slip in by boat and wreak such havoc and devastation.

The Indian Express singled out Prime Minister Manmohan Singh, saying he bore "special responsibility" because he had been "partly distracted" by modernising the country's foreign policy and its economy.

Obama names his economic team

The president-elect Barack Obama, second from the right, introduces his economic team during a news conference, Monday, Nov 24 2008, in Chicago. From left are, Treasury Secretary-designate Timothy Geithner, Council of Economic Advisers Chair-designate Christina Romer, and National Economic Council Director-designate Lawrence Summers. Pablo Martinez Monsivais / AP Photo

WASHINGTON // The US president-elect Barack Obama named his economic team last night, tapping the New York Federal Reserve president Tim Geithner as treasury secretary to deal with “an economic crisis of historic proportions”.

At a news conference 57 days before his inauguration, Mr Obama also said Lawrence Summers would be director of his National Economic Council.

Mr Summers was treasury secretary under the former president Bill Clinton and a former president of Harvard University.

Mr Obama said that recent news “has made it even more clear that we are facing an economic crisis of historic proportions”.

Offering a grim prediction, he added, “Most experts now believe that we could lose millions of jobs next year”.

He said his newly named economic team offered “sound judgment and fresh thinking” at a time of economic peril. Mr Obama stepped to the microphones one day after his aides urged the incoming Democratic-controlled Congress to work with unusual speed in passing an economic stimulus package.

Some lawmakers have said a measure in the range of $700 billion over two years may be passed, in hopes of achieving the president-elect’s goal of securing 2.5 million jobs. Mr Obama takes the oath of office on Jan 20 as the nation’s 44th president, and will confront economic difficulties as great as any since the Great Depression in the 1930s.

“The economy is likely to get worse before it gets better,” he said in a downbeat forecast. At the same time, he expressed confidence the nation would weather the crisis “because we’ve done it before”.

He called on Congress to start work on an aggressive plan when it is sworn in January, so that his administration can, as he put it, “hit the ground running”.

Mr Obama pledged to honour the commitments the outgoing Bush administration has made to rescue financial markets.

Mr Obama wants action that will stabilise the financial system and get credit flowing, as well as create jobs in areas including rebuilding infrastructure and creating clean energy.