Commandos have launched a fresh assault on the last few militants at a Mumbai hotel, as fighting that has killed at least 144 people enters a third day.
Shortly before 0730 (0200 GMT), fierce gunfire and explosions were heard at the landmark Taj Mahal Palace hotel.
Earlier, almost 100 people were rescued from a second hotel, and six bodies were found at a Jewish centre.
India's foreign minister has said "elements with links to Pakistan" were involved in the attacks on Mumbai.
However, his Pakistani counterpart has urged India not to bring politics into the issue, saying "we should join hands to defeat the enemy".
'Ultimate sacrifice'
Extremely heavy and sustained gunfire was heard inside the Taj Mahal hotel soon after dawn on Saturday, as soldiers rushed into the lobby to try to flush out the remaining few gunmen.
Firefighters have been working to contain flames and smoke that have been billowing from the building's lower floors.
The BBC's Mark Dummett at the scene says that the militants - who had been thought to number up to four - still clearly have plenty of ammunition.
He said that fighting appeared to be spreading through the hotel.
Blasts had rung out for most of Friday after truckloads of commandos entered the premises.
A journalist and bystander outside the hotel were taken to hospital after being hit by shrapnel.
Indian commandos who managed to enter other parts of the Taj say they found at least 30 bodies in one hall.
JK Dutt, the head of India's elite National Security Guards, told Reuters news agency he suspected two or three gunmen remained inside.
Fighting appears to have ended at the other key flashpoints in Mumbai, chief among them the Oberoi-Trident hotel - where nearly 100 people were rescued and 24 bodies were found earlier on Friday.
But at Nariman House, the Mumbai base of Chabad-Lubavitch, a New York-based orthodox Jewish organisation, the news was grim.
As night fell in Mumbai, the organisation confirmed that Rabbi Gavriel Holtzberg, 29, had been killed alongside his wife, Rivka.
The Holtzbergs had moved to India in 2003 from New York to run the Mumbai branch of the outreach organisation, which offers services and hospitality to Jewish travellers.
In New York, Rabbi Moshe Kotlarsky, of Chabad-Lubavitch, said the Holtzbergs had made "the ultimate sacrifice".
The couple's young son Moshe - who will mark his second birthday on Saturday - was evacuated from the building earlier in the day as commandos battled the hostage-takes inside. He is now being cared for by his grandparents.
There was no word on the identities of the others found dead on the premises. Two kidnappers were also reported killed.
The bodies were removed from the building early on Saturday.
Foreign Minister Tzipi Livni said the attack was no coincidence: "The fact that the attack took place at the Chabad house is the clearest sign that the attack was directed against Jews and Israelis."
Death toll rising
The stand-offs began late on Wednesday when gunmen armed with automatic weapons and grenades opened fire indiscriminately on crowds at a major railway station, the two hotels, the Jewish centre, a hospital and a cafe frequented by foreigners.
Indian media have reported that at least 154 people have been killed since Wednesday, with around 370 injured, the vast majority Indian citizens.
An Indian official said the toll could rise much higher.
"Once the bodies are collected, the number of deaths might go up to 200," said Minister of State for Home Affairs Sri Prakash Jaiswal.
Confirmation also came on Friday that a French couple and two US citizens died while eating at the Oberoi-Trident.
The US state department said late on Thursday that a total of five Americans were confirmed dead, and others were missing.
At least 18 foreigners are known to have died, including victims from Germany, Japan, Canada, Australia, Italy and Singapore. One Briton, Andreas Liveras, has been killed.
But security services said they had killed at least two militants as they freed people from the Oberoi-Trident on Friday morning.
FROM THE TODAY PROGRAMME
One of those freed, Briton Mark Abell, spoke of his delight at seeing several heavily armed soldiers at his hotel door after spending more than 36 hours in his room.
But he was shocked by the state of the hotel. "The lobby was carnage, blood and guts everywhere. It was very upsetting," he told the BBC.
Pakistani 'link'
State home minister RR Patil, speaking outside the Oberoi-Trident hotel, said a total of nine militants had been killed, along with 15 police officers and two commandos.
He said one of those arrested was a Pakistani citizen.
BOMB ATTACKS IN INDIA IN 2008
30 October: Explosions kill at least 64 in north-eastern Assam
30 September: Blasts in western India kill at least seven
27 September: Bomb blasts kills one in Delhi
13 September: Five bomb blasts kill 18 in Delhi
26 July: At least 22 small bombs kill 49 in Ahmedabad
25 July: Seven bombs go off in Bangalore killing two people
13 May: Seven bombs hit markets and crowded streets in Jaipur killing 63
Earlier, the Indian navy took control of two Pakistani merchant navy ships and began questioning their crews after witnesses said some of the militants came ashore on small speedboats.
India's Foreign Minister Pranab Mukherjee said preliminary evidence "leads us to believe that some elements in Pakistan may be connected to these events". But he added that it was too soon to give details.
Pakistani Foreign Minister Shah Mehmood Qureshi responded by saying: "This is a collective issue. We are facing a common enemy and we should join hands to defeat the enemy."
The head of Pakistan's powerful military intelligence agency, Ahmed Shuja Pasha, was due to travel to India to discuss the situation with his Indian counterparts, but will now send a representative instead, reports say.
India has complained in the past that attacks on its soil have been carried out by groups based in Pakistan, although relations between the two countries have improved in recent years and Pakistani leaders were swift to condemn the latest attacks.
But the BBC's Pakistan correspondent, Barbara Plett, says there is a feeling among senior officials in Islamabad that India has acted too hastily in linking the Mumbai attackers to Pakistan.
In the UK, officials denied reports that some of the attackers may have been British citizens of Pakistani origin.
The UK officials said had Indian authorities told them there was no indication so far that anyone shot or in custody was British.
A claim of responsibility for this week's attacks - the worst in India's commercial capital since nearly 200 people were killed in a series of bombings in 2006 - has been made by a previously unknown group calling itself the Deccan Mujahideen.
However, most intelligence officials are keeping an open mind as the attacks have thrown up conflicting clues, BBC security correspondent Frank Gardner says.
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