Hammond Hits Back Over £2bn MoD Underspend

By Vincent McAviney, Sky News Political Producer

The Defence Secretary has hit back at criticism of a £2bn underspend by the Government department he oversees, saying the money will be spent on future kit for soldiers.

Philip Hammond reacted angrily to claims he had been "overzealous" in pursuit of an austerity drive that will see thousands of soldiers lose their jobs.

They were made in a Daily Telegraph article which suggested the underspend at the Ministry of Defence (MoD) was partly down to cuts in military personnel and equipment.

Mr Hammond said: "These retired 'senior military figures' (quoted by the newspaper) are presumably the same people who presided over an out of control defence budget that led to the previous Government sending troops into battle without the proper equipment needed to protect them.

Mr Hammond is overseeing a major cost-cutting exercise at the MoD

"They clearly have no idea how the defence budget now works.

"Instead of having to delay and cancel programmes as in the past, we now budget prudently and then roll forward any underspend to future years, allowing us to place new equipment orders."

Mr Hammond's comments came as a Sky News investigation revealed Government departments have spent hundreds of thousands of pounds on calls to directory inquiries numbers since the last election.

The MoD alone made 158,640 calls to 118 lines between May 1, 2010, and August 31, 2013 - the equivalent of 186 calls per day - at a cost of £271,000.

A spokesman said the number of calls made from fixed phone lines had fallen by more than three-quarters in the last four years.

However, the expenditure is equivalent to the annual salaries of 15 squaddies or nine junior officers, or around 270 sets of Osprey body armour.

The Department of Work and Pensions (DWP) made 97,265 calls between May 2010 and August 2013 at a cost of £72,387.

This was despite the department barring staff from calling 118 numbers in March 2011 and Secretary of State Iain Duncan Smith pledging to cut costs to help fund police and the forces.

The MoD says it has cut the number of directory inquiry calls it makes

Robert Oxley, campaign director of the TaxPayers' Alliance, added: "It's astonishing that so much taxpayers' money has been wasted needlessly dialling these services, especially in the internet age.

"Sadly, a blase attitude over who is picking up the phone bill is all too common in some corners of the civil service."

It is the second time in as many months the MoD's spending on phone calls has been brought into question, and comes at a time when the military is undergoing a massive cost-reduction programme which includes thousands of redundancies.

In August, the department revealed it had run up a £40,000 bill on calls to the speaking clock.

The MoD has said this was partly down to a "technical error" in one of its systems which meant the number was being dialled automatically.

Thousands of soldiers are losing their jobs as the MoD cuts costs

However, Sky News now understands that between May 1, 2010, and August 31, 2013, 99,887 calls were in fact made by departmental staff to the speaking clock at a cost of £39,845.

The faulty automated system placed an additional 28,663 calls to the number but the £12,355 cost of these calls is being repaid by the company which installed it.

A spokesman for the MoD said: "Calls to directory inquiries from the majority of the 260,000 MoD fixed phone lines are banned but some staff working in isolated locations, who do not have access to a military phone network or the internet, are able to call directory enquiries to obtain contact details."

A spokesman for the DWP added: "118 numbers are banned, except where they are used by jobseekers or their advisers when looking for work.

"The costs of these calls have been cut by more than two-thirds since 2010, as more of the 1.4 million claimants we support move online for their job searches."

Freedom of Information Act requests were submitted to all government departments, although some departments including the Home Office and the Department for Environment, Food and Rural Affairs refused to provide the information.

Several other departments said they had barred 118 calls, instructing staff to use internet search engines to obtain contact details.

Labour shadow minister Jon Ashworth told Sky News: "This is yet another example of the Government's failure to tackle waste.

"David Cameron and his ministers need to act now to stop allowing thousands of pounds of taxpayers' money being squandered on these costly calls."

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Cyclone Phailin Nears India As Thousands Flee

More than 440,000 people have been evacuated their homes in two states as a huge cyclone approaches the east coast of India.

India's weather office issued a red alert, saying the "very severe cyclonic storm Phailin" was packing gusts as high as 150mph (240kph).

The evacuation is one of the biggest such exercises in the country's history, said the national disaster agency.

A satellite image of the cyclone

At least 12 million people are in the path of the storm, which is already so large it has nearly filled the Bay of Bengal - an area the size of France.

The cyclone is expected to be the fiercest storm to hit India since a devastating cyclone killed 10,000 people 14 years ago.

Some forecasters likened its size and intensity to hurricane Katrina, which devastated the US Gulf coast and New Orleans in 2005.

Fishermen pull a boat from the waters of the Bay of Bengal to safer ground

Dr Liz Bentley from the Royal Meteorological Society told Sky News: "This particular part of the coastline is very low-lying so it (Phailin) will penetrate quite well in land.

"It is like a mini-tsunami hitting that - not caused in the same way as a tsunami but it's the same effect."

Large waves have already pounded beaches in the state of Andhra Pradesh.

Villagers along the coast were evacuated to schools in the north of the state and in neighbouring Odisha, while panic buying drove up food prices.

Relief items are packaged for distribution to cyclone evacuees

Authorities have been evacuating villagers along the coast to government-run shelters and schools in three districts of Andhra Pradesh state and five districts of Orissa state.

But many villagers said they had not been told to evacuate, and others were refusing to leave their homes.

"Of course I'm scared, but where will I move with my family?" said Kuramayya, 38, a fisherman from the village of Bandharuvanipeta, while 12ft waves crashed behind him. "We can't leave our boats behind."

Floods have already ripped down power lines

Satellite images showed Phailin some 310 miles (500km) off the coast and likely to make landfall within hours, with widespread flooding expected.

The Indian Meteorological Department said Phailin would hit between Kalingapatnam in Andhra Pradesh and the port of Paradip in Odisha. Storm surges 10ft above normal tides were predicted.

Residents move to safer ground

About 12 hours before Cyclone Phailin's landfall, meteorologists held out hope that the storm might hit while in a temporary weakened state, but no matter what it will be large and deadly.

Ryan Maue, a meteorologist at Weather Bell, a private US weather firm, said even in the best-case scenario there will be a storm surge of 20-30 feet (7-9 metres).

The predicted path of the cyclone

A storm surge - the giant wall of water that that a cyclone blasts ashore - is the big killer in such events.

The storm already has been large and powerful for nearly 36 hours, he said, and those winds have built up tremendous amount of surge, Mr Maue said.

He said: "A storm this large can't peter out that fast. There's nothing to stop it at this point."

Floods have already hit ahead of the cyclone

Officials cancelled holy day celebrations and stockpiled emergency supplies in coastal Orissa and Andhra Pradesh states.

If the storm continues on its current path without weakening, it is expected to cause large-scale power and communications outages and shut down road and rail links, officials said. There would also be extensive damage to crops.

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Malala Tells Obama: 'End The Drone Strikes'

Pakistani teenage activist Malala Yusufzai has told the US President that drone strikes in her country are "fuelling terrorism".

The 16-year-old schoolgirl, who was shot in the head and neck by Taliban gunmen who attacked her school bus in Pakistan's Swat Valley, met Barack Obama and the First Lady in the White House.

"I thanked President Obama for the United States' work in supporting education in Pakistan and Afghanistan and for Syrian refugees," she said after the meeting.

Malala with her father Ziauddin in Edgbaston, Birmingham

"I also expressed my concerns that drone attacks are fuelling terrorism. Innocent victims are killed in these acts, and they lead to resentment among the Pakistani people.

"If we refocus efforts on education it will make a big impact."

The US military and the CIA have carried out hundreds of drone strikes against militant groups in the northwest Pakistan since 2004.

But the Pakistani government complains that they also frequently kill civilians and turn ordinary people against Islamabad and the US. 

Malala attracted the anger of the Taliban by writing a blog chronicling the challenges of daily life under the Islamists.

Hundreds of drone strikes have been reported in Pakistan

She is now living in Britain, where she underwent treatment for the injuries sustained in the attack, and campaigns for girls' right to education.

Mr Obama praised the teenager for her "inspiring and passionate work" and signed a proclamation to mark the International Day of the Girl.

A statement issued by the White House said: "The United States joins with the Pakistani people and so many around the world to celebrate Malala's courage and her determination to promote the right of all girls to attend school and realise their dreams."

Malala had been among the favourites for this year's Nobel Peace Prize, but the award was handed to the Organisation for the Prohibition of Chemical Weapons.

In 2012 Barack Obama condemned Malala's shooting as "barbaric". White House spokesman Jay Carney said. "I know that the President found the news reprehensible and disgusting and tragic."

The teenager was treated in Britain following her shooting in 2012

The Pakistani army retook control of Swat later that year, and Malala received the country's highest civilian award.

Since then she has been nominated for several international awards for child activists - including the EU's Sakharov human rights prize which she won earlier in the week - and has written a book about her campaign work called I Am Malala: The Girl Who Stood Up For Education And Was Shot By The Taliban.

Last week Pakistani Taliban spokesman Shahidullah Shahid said the group stood by its decision to target the teenager, who he said "targeted and criticised Islam".

"She accepted that she attacked Islam so we we tried to kill her, and if we get another chance we will definitely kill her and that will make us feel proud.

"Islam prohibits killing women, but excepts those that support the infidels in their war against our religion.".

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De Villota Death 'Directly Linked To Crash'

The family of Spanish test driver Maria de Villota have claimed her death on Friday was a direct result of her crash at Duxford Aerodrome in Cambridge last year.

A statement issued by the family read: "Maria left us while she was sleeping, approximately at 6am (on Friday), as a consequence of the neurological injuries she suffered in July of 2012, according to what the forensic doctor has told us.

"Maria is gone, but she has left a very clear message of joy and hope which is helping the family move on in these moments."

She had been test-driving a MR-01 car when she crashed

Dr Joaquin Lucena Romero, the head of forensic services at Spain's Institute for Legal Medicine, has declared de Villota's death was "due to natural causes" following a post-mortem.

But Britain's Health and Safety Executive (HSE) say they are still investigating potential links between the accident 15 months ago and her death last week.

An HSE spokeswoman stated the organisation "would expect to be kept informed of any new evidence".

The accident occurred after 33-year-old de Villota had been test-driving an MR-01 race car for Marussia, the English-Russian Formula One team based in Oxfordshire.

Despite her injuries she made a remarkable recovery in one month

After driving the vehicle at speeds of 200mph she pulled off the track and accidentally hit a stationary vehicle at low speed.

The accident left her in a critical condition and caused the loss of her right eye, though she made a remarkable recovery after just a month in hospital. Marussia were cleared of liability relating to the car

The Grand Prix Drivers' Association (GPDA) have announced they will hold a minute of silence at Sunday's Japanese Grand Prix.

A statement released by the GPDA read: "All F1 drivers of the Grand Prix Drivers' Association are very saddened to hear of the tragic death of our former member Maria de Villota.

"She has been an active member and contributed to driver safety in a very enthusiastic and most professional manner.

"Her positive attitude, maturity and extreme commitment will never be forgotten and are something we have learned from. Maria will be missed and always remembered by all of us."

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'White Widow' Lewthwaite 'Key' In Al Shabaab

By Alex Crawford, Special Correspondent, In Kenya

Sky News has obtained a Kenyan intelligence report which for the first time shows the reach of the al Shabaab terror network - which carried out the Nairobi shopping mall attack - and the extent of British involvement within the group.

It suggests that Samantha Lewthwaite - the British woman known as the 'White Widow' because she was married to one of the 7/7 London bombers - is an important figure in the terror outfit, plotting multiple bomb attacks across Kenya.

Sky has also been given access to a personal diary of hers which gives a fascinating insight into her mind, where she talks about her ambitions for her children and her love for her husband.

The intelligence report, which is 35 pages long, gives a detailed breakdown of how the network is operating throughout Africa with recruits and cells working in a huge range of countries including Somalia, Uganda, Burundi, Zambia, Tanzania, Mali and South Africa as well as further afield in Yemen and Pakistan.

The report says Lewthwaite is a 'logistician' in a six-person terror cell

But what seems clear is that the group's stronghold and focus is in Kenya with major operational bases in the capital Nairobi and Mombasa.

The report is highly damaging for the Kenyan authorities as it also shows there were clear warnings up to eight months ago that a "Mumbai-style attack" was being planned in Nairobi on the Westgate shopping mall.

It goes on to identify 29-year-old Lewthwaite as a "logistician" within a six-person terror cell which the Kenyans believe was co-ordinated by Abdulkadir Mohamed Abdulkadir, whose alias is Ikrima.

Ikrima is a Kenyan who the authorities believe has been elevated to al Shabaab management.

He was the target of the US Navy Seals' mission last weekend which set out to "capture or kill" him from the Somalian port town of Barawe.

She is implicated in the Nairobi shopping centre attack in September

The mission was aborted when the Seals encountered tougher resistance than expected when they landed.

The other members of the terror cell Ikrima was co-ordinating include Fahmi Jamal Salim, who is apparently the cell leader and who the intelligence agencies believe is now married to Lewthwaite.

Other members are said to be Jermaine Grant, who is currently on trial in Mombasa on terror charges which he denies.

The report details how the group was plotting multiple attacks targeting the Kenyan parliament buildings, UN offices in Nairobi, restaurants and a string of assassinations focusing on senior politicians within Kenya.

Londoner Jermaine Grant is also believed to be part of the same group

Kenyan intelligence believes Lewthwaite was living in an exclusive villa in the Shanzu area of Mombasa when the attacks were being planned.

A police raid on a nearby apartment rented by Grant - which led to his arrest - then prompted a subsequent raid on the upmarket villa where Lewthwaite was living with her children.

But the mother-of-four was not there. The police say they found a stash of ammunition there as well as a laptop and excerpts of a diary or journal which Lewthwaite had begun writing.

Lewthwaite's husband Jermaine Lindsay (L) on a dry run for the 7/7 attacks

The journal appears to be the start of a book which Lewthwaite was working on entitled I Want To Be A Mujahid (Islamic military fighter).

It outlines questions she was going to pose to interviewees as well as gives an insight into her love for her husband and reveals a little about how she is bringing up her children.

She writes with pride about how two of her children want to emulate their father - Jermaine Lindsay, who was one of the London 7/7 bombers in the Tube and bus attacks in 2005 which killed more than 50 people.

She recounts how her husband had asked her children what they wanted to be when they got older.

Lewthwaite writes: "Both had many answers but both agreed to one of wanting to be a mujahid."

Extracts from Lewthwaite's diary recovered by police

She goes on to express her commitment and desire to be a good Muslim and how blessed she believes she is to have been married to a shaheed (martyr) in reference to her suicide-bomber partner.

We managed to persuade one of Kenya's most controversial religious scholars to sit down with us and talk about his views - which have led to him being accused by the UN of recruiting al Shabaab fighters and raising funds for the outfit.

Sheikh Abubakar Shariff, who is also known as Makaburi, told us the accusations against him were all "b*******".

Interpol recently issued a 'Red Notice' for Lewthwaite's arrest

He accused the Kenyan government of waging a religious war and allowing the persecution of Muslims who he believes are all being targeted and labelled as terrorists in the wake of the Westgate mall attack.

"Because of the failings of our Government and our military and police in stopping the attack, we, as Muslims, are all being targeted now," he told me.

Makaburi who is also accused by the Kenyan authorities of inciting violence and of encouraging young men to take up jihad (or Holy war) in Somalia, denied he was a member of al Shabaab but said: "I am a Muslim. I speak truthfully. I might have association with al Shabaab without me knowing they are from al Shabaab.

"I cannot say no, I don't know al Shabaab. Maybe one of my friends is a member of al Shabaab without me knowing. But do I have, what you call it, ties with al Shabaab? No, I don't."

He went on to say under his interpretation of the Koran, the Westgate attack was justified because of all the wrongs being meted out to Muslims by the West, the Kenyan Defence Force (who are fighting al Shabaab in Somalia), Ethiopians and other military in "Somalia, Guantanamo Bay, Iraq and all over the world every day".

There is little chance the woman being hunted by Interpol is still in Mombasa, but what the intelligence report indicates is it is now a major hub as well as gateway to terrorism for those bent on violence.

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Royal Mail Shares Soar In First Trades

Shares in Royal Mail have soared in conditional trading, with their value jumping more than 30%.

The spike has boosted the value of the company to more than £4.5bn, up from the pre-flotation pricing of £3.3bn.

Shares opened at 8am on the London Stock Exchange at 430p each and jumped above 450p within minutes.

The pre-float purchase price was set at 330p per share.

The rise will fuel the debate over whether the sale, one of Britain's biggest privatisations for decades, was priced too cheaply, following criticism from Labour that the Government was short-changing taxpayers.

The first two days of conditional trading allows institutional investors to trade with one another, with full trading getting under way next Tuesday.

In theory if the sale of the five-century-old service was cancelled the trades would be void.

Royal Mail's flotation leaves the Government with a 38% stake, but this could fall to 30% should it choose to exercise an over-allotment option, whereby extra shares can be sold if there is strong demand.

Demand from private investors for the flotation was seven times over-subscribed, with Business Secretary Vince Cable saying there had been 700,000 applications.

Around 150,000 Royal Mail staff will each get about £2,200 of free shares but they must hold on to them for a period of five years.

Full trading on October 15 commences the day before the result of a strike ballot by postal workers.

Members of the Communication Workers Union are expected to back industrial action over issues linked to pay and conditions, with any strike set to be held on or after October 23 - the start of the run-up to the busy Christmas period.

Although the Royal Mail has seen a decline in letter deliveries amid competition from private firms and increasing use of email, its parcel delivery service has strengthened due to internet shopping.

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Human Remains Found In Mansfield Garden

Police have found the remains of two people in a garden near Mansfield.

The discovery was made by officers in the back garden of a property in Blenheim Close, Forest Town, on Sunday, according to Nottinghamshire Police.

A spokesman said it is believed the remains had been there for some time.

Police were led to the address after information came to light about an "incident" alleged to have taken place in the late 1990s.

The remains have yet to be formally identified.

Post-mortem examinations to establish the cause of death are due to take place today.

The scene has been cordoned off while forensic examinations are carried out. A white police tent and a digger could be seen in the garden.

Police spokeswoman said the current residents of the property were not part of the investigation at this time.

"They have been really supportive and understanding of the investigation," a spokeswoman said.

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Nazi War Criminal Erich Priebke Dies In Rome

Former SS captain Erich Priebke, one of the last Nazi war criminals, has died in Rome, his lawyer has said.

Priebke, who turned 100 years old in July and who was sentenced to life in prison in 1998 for his role in a massacre at Rome's Ardeatine caves in March 1944, spent the last few years under house arrest at his lawyer's Rome apartment.

Priebke had appealed his sentenced, claiming to be too ill to stay in prison and he was granted a relaxed regime of house arrest.

July: Residents protest outside Priebke's appartment in Rome

Members of the Jewish community in Rome had recently protested against his apparent freedom to wander around the city at will.

Priebke had been living under house arrest in Rome after being sentenced to life imprisonment in 1998 for the killings of 335 civilians in the Ardeatine Caves near Rome in March 1944.

Priebke was sentenced to life in 1998 over the killing 335 civilians

In March 1944, Priebke was in charge of SS troops who executed  335 in retaliation for the killings of 33 German soldiers by a partisan group.

After the war he escaped to Argentina but was deported to Italy after being interviewed on US television and admitting his role in the massacre, which he said had been conducted against "terrorists".

His lawyer Paolo Giachini said in a statement Priebke had left a final interview as his "human and political testament".

It was not clear when it would be released.

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Lynne Spalding Found Dead In Hospital Stairwell

A British patient who disappeared from her room at San Francisco's main public hospital more than two weeks ago has been found dead in a stairwell at the building.

Lynne Spalding, 57, was admitted to San Francisco General Hospital for a urinary tract infection on September 19.

The mother-of-two was reported missing from her room there two days later.

A flyer used in the search for Ms Spalding. Pic: Find Lynne

Ms Spalding's relatives and friends spent days scouring the streets of San Francisco with flyers and set up a Facebook page to help find her.

But a member of the hospital's engineering staff found Ms Spalding's body on Tuesday - 17 days after she vanished - while conducting a routine check.

Authorities are continuing to investigate how the marketing and tourism executive, who was originally from Peterlee, County Durham, got there and what caused her death.

The hospital's chief medical officer Todd May said: "What happened at our hospital is horrible.

"We are here to take care of patients, to heal them, to keep them safe. This has shaken us to our core. Our staff is devastated."

Nurses were checking on her every 15 minutes, and she disappeared in the brief time between those visits, Mr May said.

The last time she was seen - about 10.15am on September 21 - she was in a "fair condition", the hospital said.

But friends said Ms Spalding was very thin, frail and on medication that could have made her confused when she disappeared.

Police inspect an outside stairwell at the hospital

The San Francisco Sheriff's Department provides security at the hospital.

Assistant Sheriff Paul Miyamoto said it was not yet known how long Ms Spalding had been in the exterior stairwell.

The rarely used stairwell is a fire exit that has an alarm on it, is locked from the outside and exits onto hospital grounds.

"All of us are committed to learning what happened and ensuring it never happens again," Mr Miyamoto said.

David Perry, who is acting as a spokesman for Ms Spalding's family, has told Sky News that relatives and friends are "horrified, dismayed and frustrated".

"For 17 days Lynne's body was there unfound in the very hospital where she'd gone for treatment," he said.

Mr Perry said officials have a lot of explaining to do as to why Ms Spalding "died alone, in the stairwell, at one of the finest medical institutions" in the US.

"There are a number of questions for San Francisco General Hospital and the San Francisco Sheriff's Department," he told Sky News.

About 100,000 patients pass through the hospital every year

"The San Francisco Sheriff's Department oversees searches and security at the hospital, and we were assured that a search had been done.

"If they searched for her 17 days ago, it wasn't a very good search because her dead body was discovered there."

But Mr Perry praised the work carried out by the San Francisco Police Department, which was responsible for searching outside the hospital.

Ms Spalding had lived in the city for more than two decades and had two grown-up children, a 19-year-old son and 23-year-old daughter, who both live in the US.

Mr Perry said Ms Spalding's children are "stunned".

He added: "She had dozens of friends. She was well known and well liked. She was a consummate professional."

The Sheriff's Department is conducting an internal investigation of its security measures at the hospital.

The Foreign Office said it was providing consular assistance to Ms Spalding's family.

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Woman Denied Help Gives Birth On Hospital Lawn

A photograph of an indigenous woman in Mexico taken as she gave birth outside a clinic where she was denied help has led to the suspension of the health centre's director.

Irma Lopez and her husband were turned away from the health centre by a nurse who said she was only eight months pregnant and "still not ready" to deliver.

But an hour-and-a-half later, her waters broke, and she gave birth to a son, her third child, on her own, as her husband pleaded with the nurse to call for help.

The 29-year-old said: "I didn't want to deliver like this. It was so ugly and with so much pain."

The photograph of her giving birth, her newborn still bound by the umbilical cord and lying on the ground, emerged in several newspapers, including the front cover of La Razon de Mexico, and was widely circulated on the internet.

It was taken by a witness to her ordeal at the Rural Health Centre in the village of San Felipe Jalapa de Diaz.

Mrs Lopez, who is of Mazatec ethnicity, and her husband had walked an hour to the clinic from the family's one-bedroom hut in the mountains of northern Oaxaca.

She was eventually taken in by the clinic after giving birth and discharged the same day with prescriptions for medicine and products that cost her about £19, she said.

"I am naming him Salvador," said Mrs Lopez, which means saviour in English. "He really saved himself."

Authorities in the southern Mexican state have now suspended the health centre's director, Dr Adrian Cruz, and launched an investigation into the incident, which happened on October 2.

The case has pointed to the persistent discrimination against Mexico's indigenous people, and the shortcomings of its health care system.

Hundreds of women still die during or right after pregnancy.

Mayra Morales, Oaxaca's representative for the national Network for Sexual and Reproductive Rights, said: "The photo is giving visibility to a wider structural problem that occurs within indigenous communities.

"Women are not receiving proper care. They are not being offered quality health services, not even a humane treatment."

Nearly one in five women in the state of Oaxaca gave birth in a place that was not a hospital or a clinic in 2011, according to Mexico's census.

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