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Daman and Diu is the second smallest union territory of India. Lakshadweep being the smallest in terms of area as well as population. Daman and Diu are actually two parts, both on the sea side and both enclosed by Gujarat. Daman is near Surat in the South of Gujarat  while Diu is near Junagadh in the Saurashtra Peninsula of Gujarat. Daman is a small part in the Gulf of Khambhat (Cambay) while Diu is an island joined to the mainland of Gujarat by a creek. Diu lies 763 kms north west of Daman.

During the early period, Daman and Diu were part of Goa. It was only in 1987, when Goa become a full fledged state, that Daman and Diu was separated from Goa. Earlier these three different land blocks on the west coast of India had come to form one political unit after liberation from the erstwhile Portuguese regime in 1961.