The central government has earmarked 4 billion yuan (US$500 million) to improve drinking water quality in rural areas, a senior official said yesterday.

A lack of treatment facilities means more than 300 million farmers, 37.5 per cent of China's rural population, struggle to get safe drinking water, Gao Juncai, director of the National Development and Reform Commission's Department of Rural Economy, told the fifth World Water Congress in Beijing yesterday.

The central government's allocation is expected to help half of the affected people change their water supplies by the end of 2010, Gao said.

The need for action is illustrated by frequent epidemic alarms in recent years. Last year in the Guangxi Zhuang Autonomous Region in south China, at least 150 epidemics of typhoid, dysentery and diarrhoea were reported, with more than 80 percent identified as a result of people drinking polluted water, Xinhua News Agency reported.

Behind the country's rapid economic growth and development, concerns over deteriorating environment rise.

"Industrial discharge of polluted water is estimated to have increased by 30 percent this year over last year," said Xu Shufan of the State Administration of Environmental Protection.

Zhang Yue, an official from Ministry of Construction, said he was deeply worried about the problem of waste water processing.

"Currently, almost half of the waste water has not been effectively recycled despite a lot of economic input in the sector," he said.

In the coming five years, the nation will inject 330 billion yuan (US$ 41.2 billion) into waste water processing to ensure 70 percent of waste water in urban areas gets recycled, Zhang said.

Besides water pollution, China is also facing great pressure in water supply. It uses 7 percent of global fresh water resources to support 21 percent of the world's population.

With the rapid process of industrialization and urbanization, China will have to mobilize all possible resources to realize the sustainable use of water, said Vice-Minister of Construction Qiu Baoxing.

The determination to achieve sustainability will mean opportunities for investors. "China's water market value will increase by at least 15 percent by 2010," said Zhou Weifang, president of GE (China) Water & Process Technologies.

According to estimates from the Ministry of Construction, at least 1 trillion yuan (US$125 billion) is needed in the coming five years to recycle waste water, update water supply facilities, improve protection of water environment and other projects in related fields.

(China Daily September 12, 2006)