German NDR and WDR public broadcaster and the Süddeutsche Zeitung (SZ) newspaper reported on Thursday that the 14-month-old boy's parents, originally from Germany's central Hesse state, were being held in Erbil in northern Iraq.

Investigations against both parents were proceeding in Germany and Iraq on suspicion of involvement in terrorism.

Germany's foreign office and Iraqi judicial authorities had acted as intermediaries to help the grandfather collect the boy after family links were validated via DNA testing.

Early in January, the German government — responding to an opposition Greens parliamentary question —  said it thought that more than 100 infants of German parents with alleged IS links could be in Iraq.

German intelligence agencies estimate that in the years up to last November more than 960 Islamists had traveled from Germany to Syria and Iraq to join the IS prior to its military defeats.

Of these, a third are thought to have returned to Germany while about 150 had died in combat.

Read more: German rapper-turned-jihadi Denis Cuspert reportedly killed in Syria

Concerns for the future

Hans-Georg Maassen, the head of Germany's domestic VfS intelligence agency based in Cologne, said on Wednesday there were concerns the 100 children could be brainwashed and prepared to carry out attacks for the IS group.

Read more: Children of 'Islamic State' struggle to integrate in Germany

"To that extent one must consider that these children could be living time bombs," Maassen said. Many of the children concerned were still in Syria and Iraq.

Last week, the same media sources said a German-Moroccan woman from Mannheim had been found guilty of terror offenses in Baghdad.

Lamia K. and other German women and female juveniles were captured last July during the Iraqi recapture of Mosul from IS.

Read more: German 'Islamic State' bride regrets joining terror group in Iraq

ipj/jm (epd, Reuters, dpa)