Australia will begin withdrawing 200 troops from nearby East Timor today because security in the restive nation has improved since rebel soldiers wounded the president, the prime minister said.

Rebel soldiers shot and badly wounded East Timor's president and opened fire on the prime minister in what was said to be a failed coup in the recently-independent nation.

East Timor dumped its defense minister today and the government showed signs of further unravelling, as desperate residents scuffled over scarce food in the capital and looters ransacked the prosecutor’s office of vast numbers of files.