AMERICAN scientists are to manipulate the genes of aborted foetuses in

an attempt to block genetic diseases in unborn babies. They hope to use

similar techniques to protect unborn babies from HIV-infected mothers.

The projects are being given millions of dollars in grants following

President Clinton's repeal of a five-year moratorium on foetal tissue.

Dozens of applications made to the National Institute of Health --

roughly America's equivalent of the Medical Research Council -- are

bound to increase fears of ''abortion-farming''. According to this

week's issue of Science, the proposals include:

* The use of implanted neurological foetal tissue in diseases like

Parkinson's and Alzheimer's as well as trauma, stroke, and spinal cord

injury;

* Implanting pancreatic cells for insulin-dependent diabetes;

* Grafting foetal liver cells for a host of inherited diseases.

One body, the National Heart, Lung, and Blood Institute, with $1.5m to

spend on foetal research, plans to spend most of this on liver stem cell

research.

One trial involves inserting into the cells a gene code for a protein

which blocks replication of the Aids virus, HIV; the cells would be

injected into the foetuses of mothers with HIV in the hope that the

treatment would produce immune cells to resist infection.

An advantage of foetal tissue cells is their low immunogenicity,

freeing them from the constraints of adult tissue or organ transplants.

Alan Levine, chief of cellular haematology at the NHLBI, said: ''These

procedures can be done without the need for tissue matching, without

immunosuppressive drugs, and without graft-versus-host disease.''

However, one of the biggest grants to date, for a trial on foetal

brain cell transplants to Parkinson patients, has provoked a row among

scientists in the US and Europe.

This is because just one project -- by Curt Freed at the University of

Colorado Health Sciences Centre -- has been awarded $4.5m for the

biggest and most ambitious study in this field to date.

A consortium of European neural transplant scientists accuse the

National Institute of Neurological Disorders and Stroke of putting all

their eggs in one basket.

Because Freed's trial uses only one of many techniques, they, and

Freed's American colleagues, fear that failure could be a major setback

for the whole field of neural transplant.

There are also ethical concerns for half the 40 patients in Freed's

trial who will be used as controls; they will have holes drilled in

their skulls like the treatment group but nothing further will be done,

a significantly invasive procedure with no possibility of benefit.

Last month, Professor Colin Campbell, chairman of the UK Human

Fertilisation and Embryology Authority, said that, in two or three

years, women could become pregnant with eggs from an aborted foetus

using techniques developed experimentally in Edinburgh.