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Mumbai (previously known as 'Bombay') is the cosmopolitan and financial capital of India. Its not a very expensive city compared to other major cities in Asia.
$1 USD = 54 to 56 Indian Rupee in terms of exchange rate.
1 rupee is made of 100 paise. Visitors from the United States or Europe will find India a budget dream and really low on pockets but If you still wanna rough it out, here are some solutions to keep your smile still intact and see the beautiful India without clinching your teeth.
TRAVEL: People frequently travel by air (it's really cheap - booked in advance tickets between Mumbai & Delhi or Mumbai & Jaipur can be as low as USD 50-100) and by trains (the fares for the 1st class are close to airfares now, 2nd class is cheaper). If you have ample time then it would be advisable to take a rail journey to actually feel the real Indian travel experience; A word of advice: please check for the time it would take and the route. Nice routes are on the Konkan railways(from Bombay to Goa - 8hrs, very scenic and lot of waterfalls and tunnels, best month Sep - Jan) and the route in Rajasthan (it's dry and lovely). One can also take air travel if time is a constraint, it's pretty affordable. On rail 1000 Km should cost you around 500Rs = $10 USD (approx) and in the air around 3000Rs.
STAY: Well this the tricky part, you will find scores of hotel and travel agents all over the net and also pouncing on you at the airports. The best thing to do would be to discuss your plans with an Indian friend or a trusted travel agent because you could possibly end up paying almost double through some agents. Bargaining really works in India. When in places where tourism is active, try to stay in Government owned tourist hotels, but remember to book in advance. If you just land in Bombay and want to try to locate hotels when you get there, then you will be able to find a decent hotel at an affordable cost. A local 3 star hotel should cost around 2000 Rs per night for a room (with double bed and amenities) and in 5 star (like taj) can cost you almost Rs 15000 per night.
FOOD: Really tasty and dirt cheap, though check for the hygiene (especially if you love street stalls). A decent dinner at a good joint should cost you Rs.1500 per head (that is really up-market) otherwise Rs.150 per head/per meal should see you through. Bombay has fruits in all seasons, lots of cafes and pizza joints all over and also the very cheap 'UDDUPI' restaurants which are places that offer rock bottom prices with excellent taste. Would also suggest 'VADA PAV,' a local delicacy which is only found in Bombay in the whole of India. It like a burger (in an Indian style). Then you need to taste 'Pav Bhajji'- Curry with bread (Pav). These thing are cheap - each would be within Rs.50-80 per serving.
THINGS TO SEE & BUY: Normally historical sites and museums would charge you in your own currency which is more expensive than what an Indian would pay (sad but true), but still its not that expensive. One can visit local museums, but it is not recommended to go to any zoos or national parks (there are none and if there are, they have no animals). There are many art galleries if you have an artistic. One can just walk down in the markets and check out electronics, second hand books, jewelry, pirated CDs (yeah they are quite openly sold here, quite surprising,but Indians do not encourage that). Remember you are from a foreign land and 'Bargain' is the word that you have to remember throughout your stay in India. A good rule of thumb would be to look around and see if the product you want is beeing sold at many places, then it may be really cheap - in that case, place your bargain almost 4 times less than what the vendor told you. Basic costs: electronics - Rs.100 to 1000, Books - 50 to 500, CD's - 30 to 150, DVD -150 (these are the pirated ones; it's probably a better idea to buy originals).
India is rich in culture and tradition and many travellers love to collect local stuff and you'll find many around Mumbai. 'Warli' painting are a national treasure and is well known, the pottery and clay products are very famous, the antiques like the old gramphone, old vctorian clocks (along the colaba causeway market) are pretty cool. Clothes are almost 60-70% cheaper than anywhere in the world and the quality is preety good. Gujrat(West India) has many mills thus the boom. Everyone know Mahatama Gandhi (the person responsible to got india it's freedom) and the product he endorsed, 'Khaddi', basically pure cotton which is hand woven. You can buy Khaddi products from the government run shops which are caled the ' Khadi Gramudhyog' which basically translates to 'Khaddi small scale industry.