The number of babies made ill after drinking milk powder contaminated with melamine has risen to 1,253. Chinese vice health minister Ma Shaowei told reporters at a press conference in Beijing, "As many as 10,000 infants may have drunk the contaminated Sanlu milk powder." The news came after a second baby died due to melamine contamination.

New Zealand Prime Minister Helen Clark on Monday accused local Chinese officials and Sanlu Group of trying to "put a towel over" the scandal until his government blew the whistle on the issue.

"They [Fonterra] have been trying for weeks to get official recall and the local authorities in China would not do it," Clark said.

She adds, the Chinese government only acted on the problem after the New Zealand government formally informed them of the issue.

New Zealand farmer's group Fonterra Cooperative, owns over 40 percent of Sanlu, the Chinese company that manufactures and distributes the contaminated milk powder.

Clark said her government reported the issue to the central government in Beijing after local officials were alerted of the problem but failed to act.