Nov. 8 (Bloomberg) -- A Chinese-made toy containing an industrial chemical linked to a so-called ``date-rape'' drug has been recalled from U.S. and Australian shelves after children who swallowed its parts became comatose.

Aqua Dots, which features small beads that bond with water, contain chemical 1,4-butanediol, an industrial solvent that the body converts to drug gamma-hydroxy butyrate, according to the U.S. Food and Drug Administration's Web site.

Two children in the U.S. who swallowed the beads were hospitalized after they became comatose and later recovered, the U.S. Consumer Product Safety Commission said in a statement. The toys were manufactured in China and distributed by Toronto-based Spin Master, it said.

The recall comes as consumer concern grows about Chinese- made products amid revelations this year of toxic pet food, contaminated vitamins, lead paint on toys and deadly cribs. President George W. Bush earlier this week called for increased penalties for companies that sell dangerous products and establishing a certification program for producers that meet safety standards.

``High concentration of the chemical can damage our nerve system,'' said Ho Wing Shing, a biochemistry expert at the Chinese University of Hong Kong. ``1,4-butanediol is a common industrial raw material.''

Spin Master

Spin Master in a statement last night that more than 60 percent of the 4.2 million units covered by the recall hadn't reached consumers. Company spokeswoman Donna MacNeil didn't return voicemail or e-mail messages seeking comment.

Spin Master said the toys were produced by Melbourne-based Moose Enterprise Pty Ltd. through factories in China.

The product, which is labeled Bindeez outside of the U.S., sickened two Australian children as well, Melbourne's Herald Sun newspaper reported Nov. 6.

Moose Enterprise voluntarily recalled the products after a ``small number'' of children swallowed the beads and required medical attention, it said in a statement. Moose will introduce a ``foul-tasting ingredient'' into the product's formulation to ensure children don't eat multiple beads when the products return.

Phone calls to Moose Enterprise today were unanswered.

National Laws

Australian Family First Senator Steve Fielding yesterday called for national laws on dangerous toys. The current system, branded a ``joke'' by Fielding in an e-mailed statement, relies on each state enforcing bans. The country's Productivity Commission last year recommended a single body.

``We're calling for a national product safety council that can actually coordinate all of these matters concerning product safety,'' Christopher Zinn from consumer association Choice told ABC Radio yesterday. ``It's basically a hodgepodge of rules and regulations at state and federal level that do not work at the single purpose, and that is protecting people.''

Toys `R' Us Asia Ltd., a unit of Hong Kong-based Li & Fung Group, removed all Bindeez items from its stores in Hong Kong, Singapore and Malaysia in response to the sale ban in New South Wales, according to a Nov. 6 statement.

China, which produces four-fifths of the toys sold in the U.S., has been the focus of several recalls this year, including at least 21 million items recalled by the world's largest toymaker, Mattel Inc.

To contact the reporter on this story: Ryan Flinn in San Francisco at rflinn@bloomberg.net .