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The 52-year old Indian grandmaster has 13 points after the seventh round, half a point behind Carlsen, who was shocked by Norwegian compatriot Aryan Tari in the sudden death tie-break.
Anand and Radjabov drew their Classical match in 42 moves in a Guicco Pianissimo game.
In the subsequent sudden death tie-break (Armageddon), the former world champion needed only 25 moves to beat the Azerbaijan player to secure a win early on Wednesday.
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Azerbaijan star Shakhriyar Mamedyarov scored over Anish Giri to move to third spot with 11.5 points along with Maxime Vachier-Lagrave, who defeated Wesley So. Both scored wins in the classical for full three points.
In the other match of the day, China’s Hao Wang edged veteran Veselin Topalov in the Armageddon.
In the ongoing tournament, the players take part in an Armageddon (sudden death) in case of a draw in the classical game.