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Obama, Clinton face new tests in White House duel

Barack Obama and Hillary Clinton faced crucial tests in their grueling White House fight on Tuesday, as voters in Indiana and North Carolina began casting ballots in the latest Democratic showdowns.

U.S. Democratic presidential candidate Barack Obama (D-IL) (L) greets Andrea Raes after she voted along with her daughters Lilia (in pink), 3, and Sophia, 2, outside the polling location at Hinkle Fieldhouse on the campus of Butler University in Indianapolis May 6, 2008. (REUTERS/Brent Smith)

The two states, with a combined 187 delegates to the August nominating convention at stake, are the biggest prizes remaining in the tight race to see who will be the party's candidate in the November presidential election. After Tuesday, only six of the state-by-state contests will be left.

"The stakes are high and the consequences are huge," Clinton told supporters at a New Albany, Indiana, fire station on Monday night.

Polls in both states opened by 7 a.m. EDT (1200 GMT) and were scheduled to close in Indiana at 7 p.m. EDT (2300 GMT) and in North Carolina at 7:30 p.m. EDT (2330 GMT), with results expected soon afterward.

Clinton has cut Obama's advantage in North Carolina to single digits in most polls over the past few weeks. The two run closer in Indiana, where Clinton has a slight edge.

"Obviously we hope to do as well as we can, but, you know, we started out pretty far behind," she said late on Monday. "I never feel confident; I just try to do the best I can."

Obama, an Illinois senator, has an almost unassailable lead in pledged delegates who will help select the Democratic nominee to face Republican John McCain in November.

If Obama wins in both Indiana and North Carolina on Tuesday, it would end Clinton's slender hopes of overtaking him in either delegates or popular votes won in the battle for the nomination and spark a fresh flood of calls for the New York senator and former first lady to step aside.

Clinton victories in both states could fuel doubts about Obama's electability and persuade some superdelegates -- party insiders free to back any candidate at the nominating convention -- to move toward her.

Neither can win enough delegates to clinch the race before voting ends on June 3, leaving the decision to the nearly 800 superdelegates.

A split decision would leave the race largely unchanged heading to the last six contests, in which 217 delegates are at stake. "Today is likely to be 'Groundhog Day': six more weeks of this campaign," said George Stephanopoulos of ABC News.


Obama has struggled through a rough campaign stretch after last month's loss to Clinton in Pennsylvania, dogged by a furor over his comments on "bitter" small-town residents and a controversy over his former pastor, the Rev. Jeremiah Wright.

Obama, who would be the first black U.S. president, has won the votes of nine out of 10 black voters in other states, and is expected to benefit from a strong turnout in North Carolina, where African-Americans could make up more than one-third of voters in the Democratic primary.

The two Democrats, courting the working- and middle-classes suffering from an ailing economy and high gas prices, spent much of the past few days focusing on Clinton's proposal to lift the federal gasoline tax for the summer.

Obama and many economists called the plan a political gimmick that would save little money for most families, but Clinton launched an advertisement in both states questioning her rival's stance.

"What has happened to Barack Obama?" an announcer asks. "He is attacking Hillary's plan to give you a break on gas prices because he doesn't have one."

Clinton says a suspension of the tax during June, July and August, when many Americans take vacations, would help people deal with record gas prices in a faltering economy. Congressional leaders say there is little chance Congress will take up any gas tax proposal this year.

"Do I think we can get it done, past a veto by President (George W.) Bush as the ultimate blocker?" Clinton said. "It's obviously a very difficult challenge. But that doesn't mean you don't try."

Obama released his own advertisement that said Clinton offered "more of the same old negative politics." He told supporters the gas tax holiday was a dishonest approach to a real problem.

"The majority of people do find me trustworthy, more than they do the other candidate," he said. "We can't solve problems if people don't think their leaders are telling them the truth."

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U.S. slams Russia over rising tensions with Georgia

The United States on Tuesday condemned the Russian government for taking "provocative actions" against neighboring Georgia and urged both sides to take steps to avoid armed confrontation.

The White House accused Moscow of escalating tensions over the Georgian breakaway province of Abkhazia by sending in more troops, shooting down an unarmed, unmanned aerial vehicle over Georgia and boosting ties with the separatist regions.

"In recent days and weeks, the Russian government has taken what we would call provocative actions which have increased tensions with Georgia," White House spokeswoman Dana Perino told reporters.

"These steps have significantly and unnecessarily heightened tensions in the region," she said.

Georgia has tried to reassert control over Abkhazia and South Ossetia since they broke away in the early 1990s. Russia has said its troop increases were aimed at countering an attack planned by Georgia on Abkhazia and it denied the drone shootdown.

Perino urged the Russian government to reiterate its commitment to Georgia's territorial borders and sovereignty, reverse the troop movements and "cease from further provocation.

"In contacts with both the Russian and Georgian governments at the highest levels, the United States has firmly reiterated our support for Georgia's territorial integrity and strongly urged Russia to de-escalate and reverse its measures," she said.

The United States and Western allies have suspected Russia of trying to punish Georgia -- a small Caucasus country on Russia's southern border -- for its attempt to join the NATO alliance which Washington supports.

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Greed behind food price rises - development bank head

The food price crisis is caused largely by greed and speculation rather than food shortages, the head of Southern Africa's development bank said on Tuesday.

People climb a truck loaded with vegetables in Kenskoff to sell them at the streets markets of Port-au-Prince May 2, 2008. (REUTERS/Eduardo Munoz)

Spiralling food costs -- called a "silent tsunami" by the World Food Programme -- have ignited fury and a rash of protests from Haiti to Somalia to Bangladesh. Exporting countries have curbed shipments to ensure domestic supplies and tame inflation.

"These increases in food prices are not the consequence of food shortages, it's the consequence of human greed that is putting at risk the lives of millions of men, women and children," Jay Naidoo told Reuters.

"There are companies that are making super profits on this issue."

The root causes of the more than 40 percent rise in food prices in the last year are disputed. Experts point to strong demand from Asian emerging markets, adverse weather in some producer countries and increased use of biofuels.

The Asian Development Bank (ADB) said it would give up to $500 million in emergency loans to regional economies hardest hit by the crisis and double investment in the farm sector to $2 billion in 2009.

After four days of talks in Madrid, governments remained split on whether they should use export bans and market intervention to ensure 1 billion poor Asians living on less than $2 a day do not slip back into hunger and malnutrition.

"Trade measures or price controls are not efficient ways to combat the food crisis or food price inflation. It distorts the market and could exacerbate the situation in the international grain market," ADB President Haruhiko Kuroda told Reuters.

"... the best way to address the immediate difficulty is to strengthen social safety nets through targeted support for the poor rather than generalised food subsidies or trade measures or price controls."

Naidoo, of the Development Bank of Southern Africa, said on the sidelines of a conference on malnutrition in Brussels that governments and world bodies should take concerted action to control surging food prices.


Thai rice prices fell around 10 percent on Tuesday after importers taking their cue from Manila's decision to scrap a large tender held back on purchases.

Five Thai exporters quoted prices for 100 percent B trade white rice , the world's benchmark, at between $900 and $920 a tonne, free on board. That is down from last week's $990-$998 a tonne.

Calming nerves further, Thailand, the world's biggest rice exporter, backed off its proposal for an "OPEC-style" rice cartel. "If Thailand was going to set up a rice cartel to fix the price, that would worsen food security," Foreign Minister Noppadon Pattama told reporters.

On Monday, the Philippines, the world's top rice importer, scrapped its largest rice tender of the year.

Vietnam, the world's second-largest rice exporter, said it was considering imposing a duty on rice exports because it wants to save more of the grain for domestic consumption.

In Africa, Democratic Republic of Congo cut import taxes on staples including "rice, maize, wheat flour, sugar, vegetable oil, powdered milk, cement, mackerel, chicken, beef ... and equipment necessary for production," according to a government statement published on Tuesday.

Traders said the fall in prices could be limited if Myanmar, which has committed rice exports to neighbouring countries, decides to halt overseas sales and instead starts to import the grain after being hit by a devastating cyclone.

Some of Myanmar's rice customers are expected to turn to Thailand for supplies after the military-ruled country was lashed by Cyclone Nagris. The storm killed up to 22,500 people and ripped through Myanmar's Irrawaddy delta, its main rice growing area once dubbed the "rice bowl of Asia".

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Interpol launches paedophile photo campaign

The global police body Interpol launched a worldwide photo appeal on Tuesday to find a suspected paedophile after its first such campaign led to the arrest and trial of a Canadian in Thailand.

Interpol posted pictures of a white-haired, balding man on its website, saying they were part of a series that showed him sexually abusing boys aged between 6 and 10 in southeast Asia.

The identity, nationality and whereabouts of the man were not known. The first pictures of him were found by police in Norway in March 2006 and so far about 800 images have been discovered, all featuring the same victims and locations.

Interpol, based in the French city of Lyon, said it believed the photographs were taken between April 2000 and May 2001 and the man would look older today than he appeared in the pictures."

"The law enforcement community around the world has done all it can to find this man who clearly presents a danger to young children, and we are now asking the public to help identify this predator and protect other potential victims from abuse," said Interpol Secretary General Ronald Noble.

The campaign is a repetition of the first such appeal last October, when Interpol unscrambled images of a suspect's "swirly face" on the Internet.

This led to the arrest of 32-year-old Canadian Christopher Neil, who has since gone on trial in Thailand charged with molesting and distributing pornographic images of two Thai boys.

If found guilty he faces up to 20 years in prison.


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Georgia says "very close" to war with Russia

Russia's deployment of extra troops in the breakaway Georgian region of Abkhazia has brought the prospect of war "very close", a minister of ex-Soviet Georgia said on Tuesday.

A member of the Georgian Interior Ministry's troops keeps watch at a checkpoint in Upper Abkhazia May 1, 2008. (REUTERS/David Mdzinarishvili)

Separately, in comments certain to fan rising tension between Moscow and Tbilisi, the "foreign minister" of the breakaway Black Sea region was quoted as saying it was ready to hand over military control to Russia.

"We literally have to avert war," Temur Iakobashvili, a Georgian State Minister, told reporters in Brussels.

Asked how close to such a war the situation was, he replied: "Very close, because we know Russians very well."

"We know what the signals are when you see propaganda waged against Georgia. We see Russian troops entering our territories on the basis of false information," he said.

Georgia, a vital energy transit route in the Caucasus region, has angered Russia, its former Soviet master with which it shares a land border, by seeking NATO membership.

An April summit of the U.S.-led Western alliance stopped short of giving it a definite track towards membership but confirmed it would enter one day.

Russia has said its troop build-up is needed to counter what it says are Georgian plans to attack Abkhazia, a sliver of land by the Black Sea, and has accused Tbilisi of trying to suck the West into a war -- allegations Georgia rejects.

Tensions have been steadily mounting and escalated after Georgia accused Russia of shooting down one of its drones over Abkhazia in April, a claim Russia denied.

An extra Russian contingent began arriving in Abkhazia last week. Moscow has not said how many troops would be added but said the total would remain within the 3,000 limit allowed under a United Nations-brokered ceasefire agreement signed in 1994. Diplomats expect the reinforcement to be of the order of 1,200.


Russian soldiers acting as peacekeepers patrol areas between Georgian and Abkhazian forces but handing full military control of the breakaway province to the Kremlin would alarm both the Georgian government and its allies in the West.

"Those 200 km (120 miles), the distance between the Psou and the Inguri rivers, are all Abkhazia. We agree to Russia taking this territory under its military control," Sergei Shamba, "foreign minister" of Abkhazia, told the Russian newspaper Izvestia.

"In exchange, we will demand guarantees of our security."

Russian Foreign Minister Sergei Lavrov said Moscow had not received an official request from Abkhazia for its military to take control of the region.

After the NATO summit, Moscow announced plans to establish legal links with Abkhazia and South Ossetia, another "frozen conflict" region inside Georgia.

NATO has urged Russia to reverse the steps and complained that the deployment of extra troops would add to tensions. The European Union has also expressed concerns.

Iakobashvili said Georgia was urging the European Union to take a more active role in reducing tensions, with options including participating in border control or policing.

"We should have more Europe in these conflict zones," he said, while adding that no decisions on a bigger EU role had been taken during his talks in Brussels.

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China's Hu urges close Japan ties, offers two pandas

Chinese President Hu Jintao lauded closer cooperation with Japan -- and offered a pair of pandas as a friendly gesture -- after arriving on Tuesday for a state visit intended to nurture trust between the wary Asian powers.

Chinese President Hu Jintao (R) and Japanese Prime Minister Yasuo Fukuda head to a dinner hosted by Fukuda, at Hibiya Matsumotoro restaurant in Tokyo May 6, 2008. (REUTERS/Japan Pool)

The state visit, the second ever by a top Chinese leader, comes as China seeks to soothe international concern over Tibetan unrest, which has threatened to mar Beijing's Olympic Games in August.

Hu was greeted at the airport by senior Japanese officials and flag-waving well-wishers, mostly Chinese, but in the centre of the capital, more than 1,000 protesters marched peacefully chanting "Human rights for Tibet".

Trucks carrying right-wing activists roamed the city blaring anti-China slogans and Japan's national anthem. Some 7,000 police were deployed amid concern over protests by the activists, who see China as a threat, but there were no reports of scuffles.

China wants to promote an image as a friendly neighbour after years of feuding over Japan's handling of its wartime aggression.

Hu, who has stressed forward-looking goals for his five days of summitry and ceremony, said stable and friendly ties were good for both countries, whose economies are increasingly intertwined.

"Relations between the two countries now have new opportunities for further development," he said in a written statement upon arrival in Tokyo. "I hope through this visit to increase mutual trust and strengthen friendship."

In a gesture that might help woo a sceptical Japanese public, Hu offered to give Japan two pandas for research purposes, Japan's foreign ministry said in a statement, following the recent death of popular Ling Ling panda at a Tokyo zoo.

He made the offer during an informal dinner with Japanese Prime Minister Yasuo Fukuda at a Tokyo restaurant with historical links to Sun Yat-sen, considered the "father" of modern China.


China replaced the United States as Japan's top trade partner last year, with two-way trade worth $236.6 billion, up 12 percent from 2006.

"As two important powers, if China and Japan can coordinate and cooperate more, and together promote regional economic integration and respond together to international financial, energy, environmental and a series of other challenges, that would be an excellent supplement to our two countries overall trade and economic relations," Chinese ambassador to Japan Cui Tiankai said in a recent interview on Chinese state TV.

But Beijing's expanding diplomatic and military reach has also stirred anxieties in Japan over disputed energy resources, military power and the safety standards of Chinese exports.

"Although the iceberg between China and Japan has melted, fully warming relations require further efforts from both sides," a commentator wrote in China's People's Daily.

The political climax of Hu's visit is set to be a summit on Wednesday with Fukuda, when they hope to unveil a blueprint for managing future ties.

Beijing and Tokyo are keen to avoid a rerun of former Chinese leader Jiang Zemin's visit to Japan a decade ago, which left a chill after he delivered pointed lectures on Japan's 1931-1945 invasion and occupation of China.

Sino-Japanese ties chilled during Junichiro Koizumi's 2001-2006 term as prime minister over his visits to Tokyo's Yasukuni war shrine, but tensions have eased since then.

Japanese media reports said that touchy references in the joint document to Taiwan, human rights, and Japan's hopes for a permanent seat on the U.N. Security Council were still under negotiation.

The two countries are also quarrelling over the rights to gas beds beneath the East China Sea, while a row over Chinese-made dumplings laced with pesticide that made several people sick has become for some a symbol of Japanese alarm at China's rise.


Japan wants greater transparency about China's surging defence spending, set at 418 billion yuan ($60 billion) for 2008, up 17.6 percent on 2007 and outstripping Japan's defence budget. Foreign critics say China's real military budget is much higher.

Tokyo wants Chinese backing for a permanent seat on the United Nations Security Council, an issue that in 2005 fuelled anti-Japanese protests in China, where there is deep rancour over Japan's harsh wartime occupation of much of the country.

China has pressed Japan to spell out again its stance on Taiwan, the self-ruled island that Beijing says must accept reunification. Tokyo has said it supports "one China" that includes Taiwan, which was a Japanese colony for fifty years until 1945 and keeps close ties to Japan.

Few expect big breakthroughs on specific disputes, but the two sides are keen to stress forward-looking goodwill and are to issue a joint document on fighting climate change, a key topic for Japan as host of the July G8 summit.

Hu will speak to Japanese students at Tokyo's Waseda University and may unwind a bit by playing ping-pong with Fukuda.

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Bone marrow treatments restore nerves, expert says

An experiment that went wrong may provide a new way to treat multiple sclerosis, a Canadian researcher said on Tuesday.

Patients who got bone marrow stem-cell transplants -- similar to those given to leukemia patients -- have enjoyed a mysterious remission of their disease.

And Dr. Mark Freedman of the University of Ottawa is not sure why.

"Not a single patient, and it's almost seven years, has ever had a relapse," Freedman said.

Multiple sclerosis or MS affects an estimated 1 million people globally. There is no cure.

It can cause mild illness in some people while causing permanent disability in others. Symptoms may include numbness or weakness in one or more limbs, partial or complete loss of vision, and an unsteady gait.

Freedman, who specializes in treating MS, wanted to study how the disease unfolds. He set up an experiment in which doctors destroyed the bone marrow and thus the immune systems of MS patients.

Then stem cells known as hematopoeitic stem cells, blood-forming cells taken from the bone marrow, were transplanted back into the patients.

"We weren't looking for improvement," Freedman told a stem cell seminar at the U.S. National Institutes of Health.

"The actual study was to reboot the immune system."

Once MS is diagnosed, Freedman said, "you've already missed the boat. We figured we would reboot the immune system and watch the disease evolve. It failed."


They had thought that destroying the bone marrow would improve symptoms within a year. After all, MS is believed to be an autoimmune disease, in which immune system cells mistakenly attack the fatty myelin sheath that protects nerve strands.

Patients lose the ability to move as the thin strands that connect one nerve cell to another wither.

Instead, improvements began two years after treatment.

Freedman reported to the seminar about 17 of the patients he has given the transplants to.

"We have yet to get the disease to restart," he said. Patients are not developing some of the characteristic brain lesions seen in MS. "But we are seeing this repair."

MS patients often have hard-to-predict changes in their symptoms and disease course, so Freedman says his team must study the patients longer before they can say precisely what is going on.

"We are trying to find out what is happening and what could possibly be the source of repair," Freedman said.

But he has found some hints that may help doctors who treat MS by using drugs to suppress the immune system.

"Those with a lot of inflammation going on were the most likely to benefit (from the treatment)," he said.

"We need some degree of inflammation." While inflammation may be the process that destroys myelin, it could be that the body needs some inflammation to make repairs, Freedman said.

Immune cells secrete compounds known as cytokines. While these are linked with inflammation, they may also direct cells, perhaps even the stem cells, to regenerate.

The treatment itself is dangerous -- one patient died when the chemicals used to destroy his bone marrow also badly damaged his liver.

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Russia, U.S. sign civilian nuclear pact

Russia and the United States signed a pact on Tuesday allowing the world's two biggest atomic powers to boost their nuclear trade and work on new ways to prevent the proliferation of nuclear weapons.

File photo of U.S. President George W. Bush (L) and his Russian counterpart Vladimir Putin in Sochi April 5, 2008. Russia and the U.S. signed on Tuesday a long awaited civilian nuclear cooperation pact that will allow firms from the world's two biggest atomic powers to expand bilateral nuclear trade. (REUTERS/RIA Novosti/Kremlin/Files)

The civilian deal will open up the booming U.S. nuclear market and Russia's vast uranium fields to firms from both countries by removing Cold War restrictions that prevented bilateral trade potentially worth billions of dollars.

U.S. ambassador to Russia, William Burns, signed the deal with the head of Russia's state nuclear corporation, Sergei Kiriyenko, on the last full day of Vladimir Putin's presidency.

"The United States and Russia were once nuclear rivals -- we are today nuclear partners," said Burns.

At the 2006 Group of Eight summit in St Petersburg, President George W. Bush and Putin ordered ministers to reach a deal but it has faced opposition from some U.S. congressmen because of Russia's nuclear cooperation with Iran.

A 123 agreement, so-called because it falls under section 123 of the U.S. Atomic Energy Act, is required before countries can cooperate on nuclear materials.

It is critical to the Global Nuclear Energy Partnership, or GNEP, which the United States and Russia have discussed for more than a year as a way to expand peaceful nuclear energy development and mitigate proliferation risks.

"What this agreement allows us to do is to implement some very creative ideas that both Russia and the United States have put forward to deal with the growing challenge of proliferation of nuclear weapons," Burns said.

He said the deal would allow Washington and Moscow to move forward on proposals for international nuclear fuel centres, which would sell developing countries access to nuclear energy but remove the need for their own enrichment programmes.


Russia and the United States control the largest arsenals of nuclear weapons in the world and both have ambitious plans to build hundreds of new reactors for power production.

Some U.S. politicians have said nuclear cooperation with Russia should be shunned because Moscow is helping Iran build an atomic power station, but the Bush administration is keen to have the pact approved this year.

State Department spokesman Sean McCormack said in Washington that now that the deal has been signed, it would be sent to Congress for lawmakers to review "in due course".

When asked about speculation that Bush may not submit the deal to Congress -- possibly leaving it for the next president to do -- McCormack said: "Usually we don't sign agreements we don't intend to send to Congress for ratification."

Once the agreement is sent to lawmakers, it would go into force if Congress did not pass a disapproval resolution within 90 legislative days. Russia's parliament, controlled by Putin's party, must also ratify the treaty.

Russia, one of the world's biggest sellers of enrichment services, has been trying to break into the nuclear markets of the United States and European Union.

"The signing of this agreement opens a gigantic field of opportunities for the economic cooperation in the large and growing businesses linked to the civilian use of nuclear energy," Kiriyenko said after the signing.

Tuesday's agreement simplifies life for companies in both countries and allows them to strike deals on trade in nuclear materials directly among themselves.

Putin has reformed Russia's nuclear sector to boost competition and open it up to atomic firms such as Japan's Toshiba Corp, which owns U.S.-based Westinghouse Electric.

Russia has crafted a nuclear behemoth called Atomenergoprom -- which officials say is an atomic version of Russian gas giant Gazprom -- to compete with the biggest nuclear companies on the world market.

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Austrian incest victim may sue for compensation

Austrian Elisabeth Fritzl, who was imprisoned by her father for 24 years and gave birth to seven of his children, may sue her father for compensation, her lawyer said on Tuesday.

An Austrian police officer looks on as forensic experts walk into the backyard of a house in Amstetten, where Josef Fritzl imprisoned his daughter for 24 years and fathered her seven children, in eastern Austria May 5, 2008. (REUTERS/Herbert Neubauer)

Fritzl, 73, kept Elisabeth and three of her six surviving children in a windowless basement prison for nearly a quarter of a century, while raising three of their children as his own upstairs.

Lawyer Christoph Herbst said he was looking into claiming compensation from Fritzl, who had four or five real estate assets in his name, for those who had been locked in the basement.

"There is the possibility of claiming compensation for imprisonment and the damage that has been incurred by it," Herbst told Reuters in an interview.

Fritzl's assets also have debt attached to them and it is unclear how much money will be left in the end, he said.

"Now it is all about evaluating his financial circumstances. Does he actually have any wealth so that it pays off to start proceedings?"

Herbst said he had the impression that the victimised family had a loving relationship when he met them.

"My experience of the family was a very positive one. Looking at the way they treat each other, it is really very loving, they are open towards each other and they play together," he said.

United for the first time just over a week ago, Elisabeth Fritzl, five of her children and her mother Rosemarie are now in the care of a hospital in Amstetten, some 130 km (80 miles) west of the capital Vienna.

"If you see the family with your own eyes, it makes you feel much better than looking at the whole case in theory and from afar," he said.

The case came to light when the eldest child of the incestuous relationship, a 19-year-old daughter, became seriously ill and was taken to hospital more than two weeks ago.

She remains in an artificial coma and needs artificial respiration, according to her doctor.

One baby died shortly after being born and Fritzl, who also has seven children with his wife Rosemarie, burnt its remains in a furnace.

Prosecutors are investigating Fritzl for rape, incest, coercion and the death of the baby.

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