The Defence Minister, Sharad Pawar, rushed more than 2,500 troops to Bombay to help the security forces restore calm. Curfew blanketed the city, and both police and army now have orders to shoot on sight.
Mr Pawar said the security forces were instructed to take 'ruthless action' against rioters. Justifying the use of troops for civil unrest, Mr Pawar, a Bombay resident, said: 'Enough is enough. I cannot stand by and watch Bombay burn down.'
Religious strife also continued in the Gujarat city of Ahmedabad, 200 miles north of Bombay, where more than 40 people were killed over the past week.
The army fired on rioters yesterday in both Bombay and Ahmedabad and the England cricket team was forced by the prolonged rioting in Ahmedabad to cancel its game there yesterday.
Bombay is normally India's most bustling city, teeming with cars, rickshaws and more than 10 million people, but yesterday only army vehicles were moving through streets showered with broken glass and heaps of burnt clothing dragged out of the shops by arsonists.
Security forces opened fire on looters in the eastern and western suburbs, but after the troop-carriers rumbled by, mobs of looters emerged to strike again.
The violence began with clashes between Hindus and Muslims living in Bombay's festering slums. But now, according to police, religion has become a camouflage for greed. The rioting has turned to looting and arson organised by armed criminal gangs.
To defuse religious tension, the beleaguered Congress government of P V Narasimha Rao ordered the release of six leaders of the right-wing Hindu Bharatiya Janata Party, the main opposition group. Hindu nationalists are planning to defy a ban on large public gatherings by holding a 'victory parade' in Delhi to celebrate the release of the BJP's leaders. But should Mr Rao arrest them again it might add to the country's political and religious upheavals.
Mr Pawar has admitted that the Congress government's credibility had been sorely damaged by its failure to prevent the wrecking of the northern town of Ayodhya on 6 December and the violence which swept through India in its wake.
Lal Krishna Advani and other Hindu nationalist leaders were arrested after organising a march of 200,000 Hindu zealots to Ayodhya which ended with the destruction of a disputed Muslim shrine. Bombay and Ahmedabad never recovered from that secretarian violence, and a spark was all that was needed to re-ignite the killings between Muslims and Hindus.