Another 11 people died in storms and floods overnight in the desert state of Rajasthan, which adjoins the northern province of Himachal Pradesh where the hydro-power project workers' camp was flattened Wednesday.
Seven children were swept away in two separate flash floods, the Press Trust of India news agency said, while two boys drowned in a reservoir and two women were killed by lightning in Rajasthan, which faced three successive years of drought until heavy rains this monsoon season.
In Himachal Pradesh, hundreds of rescuers with earth-moving machinery to lift boulders and debris were at work at the disaster site in the Kulu valley.
"A machine with a large excavator and shovel started clearing the debris and huge boulders this morning (Friday). Our rescue operations are still being hampered by rain," said R.D. Nazeem, the deputy commissioner of Kulu.
"Except for a severed arm of a labour woman, no more bodies have been unearthed so far (during the rescue operation)," he added.
Police said 19 bodies had been recovered after the disaster, but they said it was feared 40 people could have died. Rescue workers have put the death toll much higher at around 100.
Around 200 migrant workers from Nepal and the Indian states of Bihar and Kashmir were asleep in their shanty homes when the skies opened up.
A report in the local media said 30 children were missing after the accident, but authorities refused to confirm this to AFP.
While refusing to comment on the report, state legislator Khemi Ram pointed a finger at local labour contracters.
"You see the trouble is that these labour contractors are not revealing the details of how many people they had actually employed at the site to avoid paying compensation. Confusion prevails because government agencies do not have any records," said Ram.
"The toll is likely to be between 150 and 200. A lot of bodies could still be buried in the debris or washed away downstream by the Parvati river."
"The force of a flash flood like this is so severe that even limbs get torn off by the water current. I doubt we will find bodies intact," warned an officer heading the rescue operations from India's paramilitary Indo-Tibet Border Police (ITBP).
Meanwhile, the state government released five million rupeesdollars) for the relief and rescue operation.
State Chief Minister Virbhadra Singh visited 40 injured workers in hospital in Kulu.
Engineers at the Parvati hydropower facility said it had suffered a major setback.
"Some damage has been done to the head race tunnel of the 2,051 megawatt Parvati power project," said M.M. Madan, general manager of the National Hydel Power Corporation.
"It will take several days before the approach roads to the power project site are repaired. This will naturally delay the construction of the project and is a major setback."
The hydroelectric project is one of the largest in Asia. With four tributaries of the Indus River flowing through hilly province of Himachal Pradesh, the state boasts a fifth of India's hydro-power potential.
The Meterological Department in New Delhi said it could not rule out another flash flood like Wednesday's killer deluge.
Another 78 people have died in flooding in India this year, mainly in the northeastern state of Assam, where at least 3.7 million people have been displaced, and the eastern states of Bihar and West Bengal.