Grid failure left more than 300 million people without power in New Delhi and much of northern India for hours on Monday in the worst blackout for more than a decade, while a fire killed at least 32 sleeping passengers on an express train to a southern Indian city.

The grid failure lights in Delhi and seven states went out in the early hours, leaving the capital's workers sweltering overnight and then stranded at metro stations in the morning rush hour as trains were cancelled.

Electricity supplies were restored to Delhi and much of Uttar Pradesh, a state with more people than Brazil, by midday. But the states of Rajasthan, Punjab and Jammu and India-controlled Kashmir were still without full power in the early evening.

Power Minister Sushilkumar Shinde said all power would be restored within hours.

The wreck of a burnt-out carriage smolders after it was engulfed by fire on an express train from New Delhi to the southern Indian city of Chennai on Monday. The blaze killed at least 32 passengers. Photo by Xinhua

Power shortages and a creaky road and rail network have weighed heavily on the country's efforts to industrialize. Grappling with the slowest economic growth in nine years, Delhi recently scaled back a target to pump $1 trillion into infrastructure over the next five years.

Major industries have dedicated power plants or large diesel generators and are shielded from outages - but the inconsistent supply affects investment and disrupts small businesses. Office blocks, hotels and large apartment buildings all use backup diesel generators.

Chaos reigned on Delhi's always-hectic roads on Monday as stoplights failed and thousands of commuters abandoned the metro. Water pumping stations ran dry.

"First, no power since 2 in the morning, then no water to take a shower and now the metro is delayed by 13 minutes after being stuck in traffic for half an hour," said 32-year-old Keshav Shah, who works 30 km outside the capital.

"As if I wasn't dreading Monday enough, this had to happen."

The government's top economic planning adviser, Montek Singh Ahluwalia, said the blackout may have been caused by a mix of coal shortages and other problems on the grid.

"I've no doubt that this is the area that we need to show improved performance in, and we also need show a clear sense of what we are doing to prevent it," Ahluwalia told Reuters at his office, where power had been restored some hours earlier.

He said the grid was better networked now than five years ago and power sharing was more common.

But blackouts lasting up to eight hours a day are frequent in much of the country and have sparked angry protests on the industrial fringes of Delhi this summer, the hottest in years.

More than 200 trains were cancelled with some stranded. Authorities made restoring services to hospitals and transport systems a priority.

Train fire kills 32

Also on Monday, more than 32 people were killed when a fire ripped through a coach on an express train as it carried sleeping passengers to the southern Indian city of Chennai, officials said.

The accident, on a long-distance service from New Delhi, occurred in the early hours of the morning near the town of Nellore in Andhra Pradesh state with an electrical short-circuit seen as the most likely cause.

"Thirty-two (bodies) have been pulled out from the coach," said Madhusudan Sarma, a senior administrative officer in Nellore district, adding that there were still more corpses inside.

Another 26 people have been admitted to hospital, he added.

There were two fatal accidents this May alone, including a collision that killed 25 people near the southern city of Bangalore. Four passengers also died after a train derailed in the northern state of Uttar Pradesh.

Reuters-AFP