UPDATES: As of 4pm India time (+5:30 hrs GMT)

- Large quantity of RDX found at two locations.
- 148 hostages released after Commando raid on Trident Oberoi Hotels.
- Fighting continuing between remaining terrorists and Military.
- Jewish Hostages at Nariman Point still incarcerated.

34 hours after terrorists struck the heart of south Mumbai, national security guards have almost flushed out the terrorists from the Taj hotel. Armed men and helicopters continue in their quest to drive out the terrorists holed up in a Jewish center the Nariman House and the Oberoi-Trident. While fierce gun battle still persists, 125 have been declared dead, including 14 policemen and six foreigners, 327 are injured.

While the terrorists are most probably out to make an international statement by targeting tourist hot spots, the mass number of Indian casualties too cannot be discounted. Of the 125 already declared dead 119 were Indian nationals, a majority of the injured are also Indians, casual by-standers who were killed in random firing at public places that are usually very crowded.

Sources say a majority of the Indian’s who were killed were innocent people going home after a day’s work from the center of the city from Mumbai’s biggest railway station to their homes in the suburbs, or patients in hospitals and their relatives and staff at the targeted hotels. What is disheartening is that the Indians that are believed to have been killed hail not from the affluent part of south mumbai where they worked but probably from smaller towns and cities outside the city. Being a service centered city, Mumbai is known as the melting pot of Mumbai where millions come to make it big. Many of them end up working as waiters in hotels, nurses in hospitals and everyday clergymen.

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Updates:

- Hostages held in the Taj Hotel have all been freed.
- Hostages remain at the Oberoi Trident Hotel.
- Gun battles continue at Nariman Point siege.
- More explosions heard at Oberoi Trident.
- Tata says Taj Hotel “Will be rebuilt as it was before”.

Alex De Grunwald, the well known film production director and a personal friend of mine , has reported on scenes in Mumbai direct from his residence at The Royal Bombay Yacht Club, sited just 50 yards across from the sieged Taj Hotel, opposite the Gateway of India, where the terrorists are alleged to have come ashore to attack the city.

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Mumbai, the current scene of bloody machine gun battles with grenades being thrown at civilians, firefighters and police, is India’s most cosmopolitan city. Facing the Arabian Sea, it is also it’s most Middle Eastern flavored, and the city is dotted with Parsi and Zoroastrian buildings and designs, all jostling for grandeur amongst the colonial architecture brought in by the British. For centuries, people of all faiths have traded in Mumbai. The Taj Hotel, now aflame, pock marked with bullet holes and rocked by explosions, was built by the founder of the Tata Group and is still operated by them. You were just as likely to see visiting Arabic businessmen in dish-dash-ah and headscarves in the lobby, milling around with American executives, visiting Chinese traders, and the wealthy India elite as anyone else. Yet now that same lobby has become a killing field in the name of Islam, if new reports coming to light confirm that the terrorists sped in by boat from Karachi, in southern Pakistan.

Karachi itself is the financial center of Pakistan, just as Mumbai is too India. One has to wonder about the lax security of the Naval base in Mumbai, the berths for the Indian Navy are just yards from the Gateway of India and the Taj Hotel itself, and being so one would have thought in-bound vessels should have been tracked on radar and identified. Yet the discovery of a boat full of weapons and ammunition moored just off the Gateway – and literally just across the street from the Taj – would seem to indicate security was relaxed.

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The terrorist attacks in Mumbai have taken place directly in the heart of the commercial area of the city, where all the prestigious business locations, office buildings and some of the most expensive hotels are based. The area, known as Colaba, stretches down the coast and Marine Drive, where attacks took place on the Leopolds Café restaurant, several petrol stations and the Oberoi Trident Hotel at Nariman Point, up to the Gateway of India, just across from the Taj, and further down Horniman Circle and Mahapalika Marg, where Mumbai’s main train station (Chattrapati Shivaji Terminus) is located just close to the University of Mumbai. India’s most respected barristers chambers, as well as banks and other commercial businesses are all based in this area, including our own offices which I am told have suffered gunshot damage and possibly bomb blast damage also.

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• UPDATE: 1pm (IST)

• - Nine foreigners; 14 policemen among 101 dead; 287 injured.
• -  Five terrorists killed; one captured; three escaped.
• - Terrorists apparently came from Karachi by boat; Pakistani national caught.
• - About 20 Terrorists still holding people hostage at various points in South Mumbai.
• - An e-mail was sent from a Lashkar e Toiba account in Russia.
• -Commandos search and rescue hostage from the Taj and Oberoi Hotel.
• - 5-6 Terrorists still loose on Mumbai streets.
• - 800 Army personnel on Mumbai streets.
• - NSE, BSE stock exchanges closed today.
• - Limited trains and bus services throughout the city.
• - Global leaders condemn attacks.

India’s commercial capital, Mumbai has been attacked by terrorists who took control of the city since 10pm local time last night. Said to have come by road and sea, an unknown group called the Deccan Mujahideen have claimed responsibility for the attack, however it is yet to be ascertained as to which terrorist group these people belong to.

The terrorists are said to have focused their attack on Mumbai’s landmarks, hotels major tourist sites, hospitals, Mumbai’s largest railway station and the Municipal Corporation headquarters have all been attacked primarily targeting western tourists. Latest reports state that 100 people have been killed and 900 people hurt in 10 terrorist attacks across the city.

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Last October, 2point6billion.com, reported on emerging Asian markets constantly climbing new heights - the Sensex, a benchmark index for the Bombay Stock exchange had gained by two percent to 18,658.25 after hitting a lifetime high of 18,703.67 during trade and traders were positive the market would rise well above 20,000.  Across the Himalaya’s in China the optimistic sentiment buoyed by banking and steel stocks continued. The Shanghai Composite Index gained 23.13 point to 5,715.89 on the 9th of October and the next day it gained 55.57 points, or 1 percent, to 5,771.46.

That was then.

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In government and B2B meetings held in Shanghai this past week between Muhammad Shehbaz Sharif,  the Chief Minister of Punjab, Pakistan’s most populated Province, efforts were made for a Pakistan-China free trade and development zone. Punjab would provide the land for free, while the Shanghai government would be invited to participate in management in addition to encouraging local businesses to invest. The invitation, which was met with some applause, would be “studied” by the Shanghai government, its spokesperson said.

Punjab could become an attractive destination for Chinese investment as the Province is Pakistan’s wealthiest and most productive, contributing over 60 percent of Pakistan’s total GDP, and lies close to trade routes to India which are now starting to show signs of opening up. Promising the new government of Syed Yousuf Raza Gilani, Pakistan’s Prime Minister would pay more attention to commerce and security than his predecessor, Pakistan is moving closely to a more aggressive approach to attracting FDI, including the services of Dezan Shira & Associates, who have been invited to Lahore to discuss advising on the attracting of FDI into the country, including the establishment of an English / Chinese “Pakistan Briefing” magazine to follow the same models as the “India Briefing”, “China Briefing” and “Vietnam Briefing” already part of the FDI legal / tax titles owned by a subsidiary of the firm.

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Alberto Vettoretti, the managing partner of Dezan Shira and Associates’ China practice, was recently part of a Hong Kong General Chamber of Commerce on a fact finding mission to Laos and Cambodia. 2point6billion.com recently caught up with Mr. Vettoretti to discover the changes that are taking place in this oft-overlooked corner of Southeast Asia.

2point6billion: Which are the high growth sectors in Laos and Cambodia and what is the local government doing to attract FDI in to the country?

Vettoretti: Landlocked Laos certainly faces an impediment when it comes to attracting foreign investment. However being at the confluence of ASEAN countries, the local government plans to strengthen its role as an important transportation hub in the region. As a result, the Laotian government provides incentives for investments in mining, infrastructure and power sectors including roads, railways, hydro power and mining. Some of the incentives the government provides foreign investors are longer tax holidays and duty free import of equipment.

The Cambodian government is for the post part politically stable. Open to investment Cambodia allows 100 percent ownership in all sectors ranging from banking to telecommunications. As the Cambodian government is trying to diversify from a garments economy, they are attracting foreign investment through competitive investment incentives and low labor costs. The local government has also approved 18 special economic zones to spur foreign investment in the country.

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The August Issue of India Briefing, our sister publication which focuses on foreign direct investment into India is out now. This latest issue, features India’s growing global stance as a manufacturing hub.

The cover story, “Establishing Manufacturing Operations In India”, deals with legal, tax, financial and operational guidelines, regulations and approval procedures to assist foreign investors set up a manufacturing unit in India. Please do click on the image to download your own personal copy of the magazine for free.

While the main article features application procedures and license approval processes the magazine also features tax compliance’s, labor laws and outlines for setting up a manufacturing base in India’s special economic zones.

In order to bring our readers practical best practices while setting up a manufacturing hub in India, we have also included two market entry case studies on the auto components and electronic products industries, two high growth sectors in India’s booming economy.

The magazine will also be available to download in Mandarin from our website shortly.

For further enquiries on Tax or legal set up in India, please do contact our India Desk at india@dezshira.com

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While Michael Phelps might have won more gold medals than some Asian countries, Asian athletes are performing well too. Asians have won 31 gold medals and 65 medals in total.

As of this morning, the Asian tally means that China gets gold with 18 medals, South Korea gets silver with 13 medals and Japan gets bronze with 9 medals. Interestingly, the three have all played host to the summer Olympics, with Beijing following the suit of Tokyo in 1964 and Seoul in 1988. Besides the three Asian powerhouses, North Korea has won 7 medals, India, Thailand and Vietnam 1. Badminton, table tennis and baseball, where Asians are expected to dominate are still under way.

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