Shortage of water resources is ...restricting the country's sustainable economic and social development

People's Daily

The report described the water crisis in several northern cities, including the capital Beijing, as the most serious since communist rule was established in 1949.

It said the situation was being exacerbated by pollution and inefficient usage by industry and agriculture.

Water relief project

China's northern regions have already suffered three years of drought and meteorologists believe the trend will continue this year.

Reservoir levels have fallen 11 per cent compared to the same period last year.

The water ministry said the capital was expected to be short of 794 million cubic metres of water by 2005, rising to 1.6 billion in 2010.

Large tracts of farmland face "disaster", officials say

The continuing shortage of water resources had become an important factor restricting sustainable economic and social development, the People's Daily said.

China is due to start work this year on a costly and ambitious plan to divert water from the south to the drought-ridden north.

It will take water from China's longest river, the Yangtze, to three rivers in the north, the Yellow, Huai and Hai, whose basins are running dry.

The project - first suggested by Chairman Mao 50 years ago - has met with opposition from environmental experts, who say there are far simpler ways to solve China's water crisis.

Construction costs are put in excess of $22bn, with initial phases expected to be operation within five to ten years.