Al-Qaeda's cloud of suspicion

Namrata Goswami, associate fellow at the Institute for Defense Studies and Analyses in New Delhi, says the attackers are domestic terrorists who sought to impress Islamist militants around the world. "They want to establish some kind of linkage with al-Qaeda," she said. "But I don't believe it is there. The motive is very, very clear. This outfit wants to attract sponsors abroad. There's a lot of money in it."

Goswami said Indian Muslims bear plenty of grievances. They lag economically. And they have been targeted by Hindu extremists; hundreds of Muslims died, for instance, in communal riots in the Indian state Gujarat in 2002.

Other analysts, such as Sajjan Gohel, director of international security for the Asia-Pacific Foundation in London, see the attacks as part of a broader struggle to foment holy war against the West and its allies. "There could be an indigenous element," Gohel said, "but there are always transnational links, normally leading back to al-Qaeda and company in Pakistan."

Al-Qaeda has suffered heavy losses this year in Iraq, where Iraqi Foreign Minister Hoshyar Zebari told Reuters on Thursday that the war against the militant group was in its "final stages." U.S. military commanders, however, have warned that al-Qaeda is shifting operatives back to the Pakistani-Afghan border region, and it wants to show it is still capable of spectacular attacks.

"I would be stunned if (the Mumbai attacks) were not very heavily based in Pakistan," Turzanski said.

Whoever the attackers were, they caught Indian security forces unprepared. "Till now, we were greeting with glee Pakistan's incompetence in dealing with terrorism," Bahukutumbi Raman, former head of counterterrorism for India's intelligence agency, wrote on his blog after the Mumbai attacks. "We can no longer do so. We have become as clueless as Pakistan."

According to the Associated Press, more than 30 terrorists entered the city by ship, then clambered into inflatable rubber rafts around 9 p.m. Wednesday, passing through the Gateway of India — a massive archway on the Mumbai waterfront built during British colonial rule.

The killing began at Café Leopold, a watering hole for Western tourists who come to unwind in a dining room decorated with a picture of Elvis Presley.

Sharma, the street salesman, said he thought he heard the pop of firecrackers left over from the recent Diwali festival. They were gunshots. He saw people running and screaming. Then he spotted two gunmen picking off patrons in the cafe.

Five minutes later, the terrorists stormed the nearby Nariman House, owned by the ultra-Orthodox Jewish group Chabad-Lubavitch. Three people — including the toddler son of Rabbi Gavriel Holtzberg — walked out. The rabbi and others remained inside, their fates unknown, the Jewish group reported on its website. RAND's Christine Fair said it is the first known attack on India's Jewish community.

The attackers moved onto the majestic Victorian-style Chhatrapati Shivaji train station, mowing down commuters with Kalashnikov assault rifles.

At 10 p.m., gunmen barged into the Oberoi luxury hotel through different doors.

Madhur Kapur was enjoying dinner with her banker husband when a lone terrorist carrying a machine gun barged into the hotel's Kandahar restaurant and told everyone to freeze.

Instead, chaos ensued. Kapur fled down a fire escape and made it downstairs to the swimming pool, where Indian security forces helped her to safety. She hasn't seen her husband since.

A similar scene unfolded at the iconic Taj Mahal Palace & Tower, a 105-year-old landmark that caters to Mumbai's elite and to famous foreign guests including Mick Jagger and Steven Spielberg.