At least 261 people have died and 650 injured in India's worst rail accident in over two decades, officials said on Saturday, after a three-train collision in the eastern Indian state of Odisha on Friday evening.

More than 3,500 passengers were on board the two passenger trains that collided, and the death toll is expected to rise as many are still trapped in the wreckage. 

The railways ministry announced an investigation into the crash and the cause is not yet clear.

Surviving passenger Anubha Das said he would never forget the scene. "Families crushed away, limbless bodies and a bloodbath on the tracks," he said.

The Indian state has declared June 3 a day of mourning in light of the deadly accident.

Search and rescue underway

An extensive search-and-rescue operation has been mounted, involving hundreds of fire department personnel and police officers as well as sniffer dogs. National Disaster Response Force teams were at the site.

Video footage showed derailed train coaches and damaged tracks, with rescue teams searching the mangled carriages to pull the survivors out and rush them to hospital. 

People were seen searching for their relatives at the site and nearby hospitals.

Hundreds of young people lined up outside a government hospital in Odisha's Soro to donate blood.

Prime Minister Narendra Modi was flying to the scene, ANI news agency reported, citing sources. The prime minister said he was "distressed" by the accident and said "all possible assistance" was being given to those affected.

Families of the dead will receive 1 million rupees ($12,000), while the seriously injured will get 200,000 rupees, with 50,000 rupees for minor injuries, Railway Minister Ashwini Vaishnaw said. Some state governments have also announced compensation.

'Hour of grief'

The collision occurred at about 7 p.m. local time when the Howrah Superfast Express, running from Bangalore to Howrah, West Bengal, derailed and became entangled with the Coromandel Express, which runs from Kolkata to Chennai, railway officials said. 

According to Indian Railways, its network facilitates the transportation of over 13 million people every day. But the state-run monopoly has had a patchy safety record because of ageing infrastructure.

Despite government efforts to improve rail safety, several hundred accidents occur every year on India's railways. Most train accidents are blamed on human error or outdated signaling equipment.

India's worst train disaster was in 1981, when an overcrowded passenger train was blown off the tracks and into a river during a cyclone in Bihar state, killing at least 800 people.

Friday's crash ranks as its third worst, and the deadliest since 1995, when two express trains collided in Firozabad, near Agra, killing more than 300 people.

(With input from agencies)