Mumbai is a city of extreme contrasts, of great prosperity and abject poverty, of 21st-century technology and medieval squalor, epitomised by the destitute and crippled lying in rows beneath bright, electronic advertisements for dotcom companies. It boasts the finest collection of Victorian buildings anywhere in Asia and a myriad of temples and mosques. Yet 55% of its population live in slums - the highest percentage for any large Indian city.

Mumbai is also congested with people (it has a population of over 16 million, which is rising relentlessly), its streets are clogged with traffic, its air is foully polluted by the barely controlled emissions of its factories and vehicles, and many of its buildings are slowly crumbling. However, the city still has much to offer. Mumbai is a colourful (the saris, the bazaars, the Indian sunlight), vibrant, energetic and friendly city, with a varied and fascinating history and many reasons to face the future with confidence.

Once Bombay (the city was renamed after the Hindu goddess Mumbadevi in 1995, although both names are still widely used), Mumbai juts out southwest from the Indian subcontinent into the Arabian Sea. It has a hot, humid climate, which is only partly relieved by the annual arrival of the monsoon, between June and September. Originally, Mumbai was a group of seven separate islands. Gradually the islands merged into a single peninsula as land was reclaimed from the sea, although some of the former islands still lend their names to parts of the modern city - Colaba, for example.

Until the arrival of the Portuguese at Bombay in 1509 (they coined the original name, which is a corruption of the Portuguese for ‘good bay') the islands were home to the Koli fishermen and to a community of Buddhist monks. The Portuguese established a trading base and dominated the region for more than a century. In 1661, the Portuguese colony passed to Britain, as part of the marriage settlement between Charles II and Catherine of Braganza. From then until 1858, Bombay was governed by the East India Company, whose raison d'être was trade and profit.

In 1858, following the suppression of the Indian Mutiny, control of British India passed from the East India Company to the Crown, where it remained until independence in August 1947. It was during this 90-year phase that the modern city took shape. The demolition of the old Bombay fort, in the 1860s, was the precursor to the redevelopment of the British city, or what is now the centre of the city - the area referred to as ‘Fort'. Similarly, the extensive 1920s and 30s land reclamation along Back Bay provided the space for the development of the Marine Drive area of the city, now one of the most important parts of Mumbai.

From its earliest days, Mumbai was a trading place and today is the financial centre of India, home to the country's largest stock exchange and the heart of its banking industry. It handles nearly a third of India's foreign trade and is host to a large number of foreign multinationals. It is an important centre of the gem trade and its film industry (Bollywood) is a national institution. For many visitors, the city is only a point of arrival, a springboard for the south or the architectural glories of the north. But to pass through Mumbai without tarrying a while is to miss one of the world's great cities, as worthwhile and idiosyncratic as any on earth.