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Mumbai, India's Commercial Hub, Disrupted by Monsoon (Update4)

July 27 (Bloomberg) -- Mumbai, India's financial capital, was
paralyzed for a second day as record monsoon rains caused power cuts
and forced the closure of the airport and train system, used by about
a third of the city's population. The government declared a public
holiday.

Suburban train services and city buses, the main mass transport system
for the city, haven't resumed operations. The Western Railway
announced that suburban services would remain suspended until 12:30
p.m.

About 6.1 million people ride Mumbai's trains each day, about as many
as the number that travels on all of New York City's subways, buses,
trains and ferries combined. The trains connect the suburbs to the
downtown districts, where the central bank, the Mumbai stock exchange
and offices of companies such as Reliance Industries Ltd. are located.

The Mumbai stock exchange, which hosts the benchmark Sensex, opened
for trading at its usual start time of 9:55 a.m.

``We should be able to run the exchange as most of our staff stayed
back in the office,'' Kalyan Bose, spokesman for the stock exchange in
Mumbai, had said in a phone interview before trading began.

The Maharashtra government announced a public holiday in the state
because of the rains, A. Ashtaputre, state government spokesman, said
in a phone interview.

``We have declared a public holiday so that people stay home and don't
bring vehicles out to the roads,'' Maharashtra Chief Minister Vilasrao
Deshmukh said in an interview telecast on the NDTV 24x7 news network
today. ``Our first job is to rescue people. The whole machinery is
geared up and we are trying our best.'' The city received had 660
millimeters of record rainfall, he said.

Damage Estimate

The state government put the damage at 5 billion rupees ($115 million)
as per initial estimates.

``Efforts to restore normalcy are proceeding on a war footing,'' the
state government said in a statement translated from Marathi, the
local language. ``The government placed as many as 5,000 personnel
from the navy, air force and the army on standby to aid efforts.''

Children stranded at schools have been moved to safety, the government said.

``Provisions for drinking water have been made for commuters stranded
in trains stuck at stations,'' the government said. ``As many as
10,000 people stuck in flood waters have been moved to safer
locations. Stocks of essential commodities such as food and medicines
are plentiful.''

Hotels Full

Hotel lobbies in downtown Mumbai were crowded last night with people
looking for rooms to stay as they were unable to leave the city and
stranded workers from nearby offices looked for accommodation.

Mumbai airport, India's busiest, has been closed to traffic, said Jet
Airways (India) Ltd., the nation's biggest domestic carrier.

``Due to heavy rains, Mumbai airport has been closed till further
notice. Reports indicate that the instrument landing system at Mumbai
airport is not available,'' Jet Airways said in a statement obtained
by fax in New Delhi. ``Thus, all flights to and from Mumbai have been
canceled until further notice.''

The airline has diverted 16 flights that were due to land in Mumbai to
other destinations. Jet Airways canceled at least six flights from New
Delhi bound for Mumbai last night because of the airport shutdown,
Saroj Datta, executive director, said in an interview today.

Road Traffic

Road traffic remained suspended in suburban Mumbai because of
flooding, B.D. Parande, a police spokesman said in a phone interview
today, preventing travelers from reaching the airport.

Phone networks were disrupted because congestion didn't allow calls to
be completed. Government, railway and power utility help lines were
inaccessible.

Heavy rains have been forecast in Maharashtra and the neighboring
state of Goa, the Indian Metrological Department said on its Web site.

Reliance Industries, India's biggest non-state company, and Tata Steel
Ltd., the second-biggest steelmaker, will announce first-quarter
earnings today as scheduled.

Reliance's board will meet at 12 p.m. local time to sign off on the
earnings, spokesman Yogesh Desai said. Tata Steel's board will meet at
11 a.m. local time, spokesman Milind Rege said. Both the companies are
based in Mumbai.

Bharat Petroleum Corp., India's third-biggest oil refiner, delayed its
board meeting by a day, the company said in a statement. The board
will meet in New Delhi, the country's capital, tomorrow.

Essar, Grasim

Essar Steel Ltd., India's fourth-largest steelmaker, might delay its
board meeting by a few hours because some directors may have
difficulty reaching the company's office in the city, spokesman V.
Krishnan said.

``The board meeting is on,'' said Pragnya Ram, spokeswoman for Grasim
Industries Ltd., India's third-biggest cement maker, which is
scheduled to announce its first-quarter earnings today. ``The office
is working.''

YES Bank Ltd., the first new Indian lender in a decade, rescheduled a
board meeting to later in the day as two board members couldn't reach
Mumbai, the company said in an e-mailed statement.

Reliance Energy Ltd., one of two power utilities in the city of 16
million people, yesterday stopped supplies in some waterlogged areas.
The utility has restored supply to 60 percent of customers, the
company said in a statement this morning.

Hindustan Lever

More than 150 employees at Hindustan Lever Ltd.'s headquarters in
Mumbai stayed back. The company, India's biggest consumer products
company and a unit of London- and Rotterdam- based Unilever, has about
400 employees at its main office located in the city.

``The flat on the terrace of our building was opened for stranded
employees to stay the night and with a power blackout we switched on
generators,'' Paresh Chaudhry, spokesman of Hindustan Lever, said in a
telephone interview from Mumbai. ``About 200 employees, half the total
strength, are back at their work stations today.''

The Maharashtra government yesterday ordered schools and colleges to
remain shut today and tomorrow to house stranded people in the
commercial capital of Mumbai.

Monsoon rains caused flash floods in areas elsewhere in the western
state of Maharashtra, including Pune, a city located about 150
kilometers (93 miles) from the commercial hub. Mumbai is the capital
of Maharashtra state.

Rainfall in July, which accounts for a third of the June-to- September
monsoon rains, was 1 percent above average across the South Asian
country, according to the federal weather agency.

Rains along the western coast caused mudslides in the coastal and
hilly regions of Maharashtra, killing at least 28 people, Suresh
Wandile, a state government spokesman, said in a phone interview
yesterday.

The Central Railway, which links Mumbai to the cities of New Delhi and
Kolkata, and runs two of the city's three suburban networks, has
suspended the services of 1,203 daily shuttles since 4:15 p.m.
yesterday.

``Leave alone the tracks, even platforms are under water in some of
the stations on the suburban routes,'' Chandra Sekhar, a Central
Railway spokesman, said in a phone interview in Mumbai. ``We can't say
when we can resume services. We have to wait for the water level to
recede.''

Chandra Sekhar said railway tracks in Kurla, a key railhead that links
to the Bandra-Kurla Complex, is under 52 inches (1.32 meters) of
water.

``It is impossible to move the rakes when vast stretches of the
network is under water,'' Chandra Sekhar said. The National Stock
Exchange and ICICI Bank Ltd.'s headquarters, among others, are located
at the Bandra-Kurla Complex in the northern suburbs.

-- 
Cheers,

Gabe Menezes.
London, England

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