I walk back to Nariman House down an empty Colaba Causeway, all its shops shut, the usual crowd of backpackers, tourists and touts gone. The road takes me past the Parsi housing estate, the model for Firozsha Baag in the works of Rohinton Mistry. Leopold's Restaurant, where backpackers were sprayed with machine-gun fire on Wednesday night, is boarded up. Two terrorists, who had eaten at the restaurant before opening fire, are known to have walked from here the 200 or 300 yards to the back of the Taj.

Almost opposite Leopold's is Colaba police station. Apparently, when a couple of cops finally came out to investigate, the gunmen calmly shot them. No more police emerged. Nor was there a response from the massive headquarters of the Maharashtra state police, only a quarter of a mile down the road and equidistant to the Taj.

At Nariman House, a battle is under way. The whole neighbourhood is watching from what is almost a safe distance. Most people are sensibly keeping to walls and out of direct sight of the buildings' windows, though one man holds his baby up for a better view. Yesterday a couple of middle-aged residents watching from a balcony were killed by stray rounds. A teenager sees my camera and directs me to an unfinished apartment building. I climb rickety stairs and find myself with a TV camera crew and some local boys looking right across at the top floor of Nariman House. There are onlookers on all the surrounding rooftops, including a mass of small, blue-uniformed figures on what is obviously a school.

The shooting gets louder and more frequent, and a grenade blows out the windows of one floor of Nariman House. It's hard to believe that the hostages can still be alive some seven hours after the assault began and apparently ground to a halt. According to the news, the terrorists are now on the third and fourth floors and the commandos are squeezing them in a pincer movement from the top and ground floors. But between the outbursts of shooting the commandos on the roof look strangely nonchalant, pacing up and down, looking out at the crowd, their carbines loose at their sides.

After some more grenade explosions and outbursts of fire, it's announced on the news that according to the police the siege is over and the terrorists are dead. But firing breaks out again. Eventually, around 6pm, there's a big explosion and this time it really is the end. The terrorists (who turn out to be two in number rather than ten) are dead and so are all the hostages.