Massacre at Mumbai is the headline on the front of the Independent

Suspected Islamist gunmen launched waves of attacks in the heart of India's financial capital, taking many foreigners hostage in two of the city's plushest hotels, police said today.
The late-night attacks sent shockwaves through an economy already under strain. Authorities closed stock, bond and foreign exchanges as commandos and armed police laid siege to the gunmen.
At least 101 people were killed, including six foreigners, police said. Another 287 people were wounded in the attacks, which were claimed by the little-known Deccan Mujahideen group.

The Guardian reports that

At least 80 people were believed killed, with 10 shot dead at Chhatrapati Shivaji terminus, formerly known as Victoria terminus, one of the two big stations in central Mumbai. Shots and explosions were reported in eight locations across India's financial capital including the crowded CST railway station, and two five-star hotels, the Taj Mahal and Oberoi Trident , leaving hundreds injured. At least 11 police officers including Maharashtra's anti-terrorism squad chief, Hemant Karkare, were killed in the attacks. Karakare was killed in a bomb blast at the Oberoi Trident.

The Times says that

Police with loudspeakers declared a curfew around the Taj Mahal hotel, where at least two gunmen are still holding a number of hostages, many of them British and American.
Green uniformed soldiers were seen entering the Taj hotel and the Oberoi. Ambulances were moved close to the Taj in what might signal the start of a police assault on the building and its occupiers

The atrocities in India moved yesterday's other big story off many of the front pages but the Telegraph leads with the news that 30,000 staff at Woolworths face the axe

Tens of thousands of retail jobs were at risk last night after the collapse of both Woolworths and MFI.
The board of Woolworths appointed Deloitte as administrators to its retail business and specialist distributor EUK after crisis negotiations with its lenders broke down following a week of talks. The talks collapsed despite a last minute intervention by the Government

The Express leads with the story

As new figures revealed that retail spending has plunged at its fastest rate in 13 years, both famous chains were forced to call in administrators.
Stunned analysts described the joint collapse as a “bloodbath on the High Street” and warned of mass redundancies of Woolies’ 30,000 staff and the closure of many of its 815 stores.

The Independent pays its respects to the High Street chain

Let's pause to consider the colossal significance of that. Despite its American roots, Woolworths managed, from the moment it arrived on our shores, to assume a quintessentially British identity. Unlike McDonald's incongruous golden arches or GAP's preppy khakis, "Woolies" seemed to be the perfect fit for the British high street. Its enduring contribution to our national consumer culture could be the pick'n'mix counter, which still dominates the front of every branch. To stand on the store's peeling linoleum beneath strip lighting and scoop jelly babies into a paper bag is to enjoy an experience familiar to every generation since 1945. The chain survived the austerity of the post-war years, the Winter of Discontent, the boom and bust of the Eighties and Nineties

Meanwhile the political battle over the economy continues,Parties clash on claims of VAT rises says the Guardian

Gordon Brown and Alistair Darling faced Conservative claims yesterday, which they failed to deny, that the government had considered pushing VAT up to 20% in 2012 and not just the 18.5% leaked on a government website on Tuesday night.
During exchanges in the Commons, Brown was challenged by David Cameron, the Tory leader, and Darling by George Osborne, the shadow chancellor, to deny that they had ever considered increasing VAT to 20% as the best way of fixing the hole in the government's finances. But Brown and Darling said a range of options had been considered.

The Times says that

The Chancellor was forced to backtrack on a key element of his Pre-Budget Report (PBR) on Wednesday after he admitted that the Treasury had got its sums wrong and raised the duty on spirits by too much.
The proposed duty rise of 8 per cent announced on Monday, part of a package of duty increases designed to offset the cut in VAT from 17.5 per cent to 15 per cent, has been halved to 4 per cent to leave the cost to the consumer broadly unchanged

'British Fritzl' got sex slave daughters pregnant 19 times to milk thousands in child support

says the Mail

The extraordinary allegations were made by the man's sister-in-law, who also revealed the full horror of her nieces' 28-year ordeal.
Care officials squandered a staggering 150 chances to save the two sisters who were kept as sex slaves by their father.
He repeatedly impregnated them - under the noses of social workers and other professionals who repeatedly failed to halt the abuse.

The Independent reporting that

Social services conceded yesterday that there were systematic shortcomings in the handling of the case of two women repeatedly raped and made pregnant 19 times by their tyrannical father over 27 years.
And the Prime Minister, Gordon Brown said everyone in the UK would be "utterly appalled" by the "unspeakable" plight of the sisters who now have seven children between them as a result of the incestuous attacks

The Sun meanwhile leads with

SIX Sun journalists carry sacks bulging with signatures to No10 Downing Street yesterday — spelling out a nation’s fury over tortured Baby P.
It took 100 bags to hold our petition containing 1.2MILLION names, all telling PM Gordon Brown that social workers who let the tragic lad die must go.

Climate change watchdog backs expansion of Heathrow reports the Guardian

The UK could meet its ambitious pledge to slash greenhouse gas pollution even if ministers give the go-ahead to expanding Heathrow airport, the government's leading climate change adviser has signalled.
This week the chairman of the government's Environment Agency, Lord Smith of Finsbury, joined critics who say that adding a third runway at Britain's biggest airport would destroy the government's promise to tackle climate change, and increase local air and noise pollution to intolerable levels.

According to the Telegraph, Obama plans 20,000 troop surge to boost Afghan effort

The President-Elect's intention to shift the focus of the fight against terrorism to Afghanistan has been bolstered by Robert Gates agreement to stay on as Defence Secretary.
Mr Gates is a strong believer in an Afghan surge, which would not only put thousands more boots on the ground but involve negotiations with malleable branches of the Taliban.

Bangkok completely closed off by protesters reports the Times

Thai anti-government protesters have shut down Bangkok's second airport, effectively isolating the city from the rest of the world.
A day after they forced the closure of the main international airport, stranding thousands of passengers including British holidaymakers, supporters of the People's Alliance for Democracy (PAD) surrounded the Don Mueang airport, from where many of the country's domestic flights depart.

According to the Mail,Teenage muggers to be let off if they say sorry under new plans

First-time offenders given a Youth Restorative Disposal will receive no formal record provided they do not break the law again.
The architects of the YRD, to be tested in eight counties, say it will give 10 to 17-year-olds who commit 'low-level crimes' a chance to 'take responsibility' for their actions.

The Independent reports that

A lesbian soldier whose career in the Army collapsed after she was sexually harassed by a male sergeant who claimed he could "turn her straight" won nearly £190,000 compensation yesterday. The Ministry of Defence was ordered to make the payout to Lance Bombardier Kerry Fletcher after she was routinely pestered for sex during her time at an Army stables in RAF Topcliffe in North Yorkshire.

Finally it is amonth until Xmas and the Guardian reports that

A Santa Claus was removed from his grotto after a woman complained that he asked if she wanted to sit on his lap, despite warnings about his behaviour by his helper elf.
Andrew Mondia, 32, who says he was sacked from the central London Selfridges store after only three days on Monday, said: "I had no intention of offending her, I just wanted to include her in the moment. Christmas is for adults too.
"I was just being my innocent usual self. I was shocked when they told me. I couldn't believe I've been sacked for being too friendly."