Chinese police today shot dead a hijacker who had strapped explosives to himself and taken a bus full of tourists hostage in the country's ancient capital, Xi'an.

The bus, which had ten Australian tourists and a Chinese translator on board, was in the central Drum and Bell Tower Square of the city, famous for its Terracotta Warriors.

The attacker, named by police as Xia Tao, from Yanliang district of the city, said he would detonate the explosives if the police did not negotiate with him.

Police have not revealed what his demands or grievances were. He then demanded that he switch buses and head out of town towards the airport so that other civilians would not be affected.

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At this point, he also released all the hostages except for one of the tourists, a 48-year-old woman from New South Wales, and the translator.

On arrival at the toll gate on the airport express road, police marksman shot him dead.

Chinese state media said that according to the local public security bureau, negotiations had been “unsuccessful”.

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