Digging on a tunnel beneath the Yellow River in Shandong Province began on Friday as part of a massive south-to-north water-diversion project.

The 7,870-meter tunnel would annually divert 442 million cubic meters of water from the Yangtze River to the northern banks of the Yellow River, said Zhang Jirao, director of the South-North Water Diversion Project Office of the State Council.

Tunneling was scheduled to be completed in three years with an investment of 613 million yuan (US$92.1 million).

Water shortages have become an obstacle to the development of northern China in recent years.

Hebei Province and Tianjin Municipality will directly benefit from the tunnel upon its completion, the official added.

In order to ensure success, an experimental tunnel was constructed under the Yellow River, the country's second longest river, in the 1980s. This provided experience and data for the design and construction of the tunnel.

In 2002, China approved the south-to-north water diversion project that aims to relieve severe water shortages in parched northern areas.

Three routes were planned - eastern, middle and western.

Upon completion, Beijing, Tianjin, Hebei, Henan, Shandong, Qinghai, Gansu, Ningxia, Inner Mongolia, Shaanxi and Shanxi will benefit from the project. About 300 million people live in those areas.

Those areas produced one-third of the country's GDP and grain with about 20 percent of the country's average per capita water resources.

The water diversion project, with a total cost forecast at 486 billion yuan, will have a far-reaching impact on the sustainable development of the country, and benefit generation after generation, observers said.

Construction will take 60 years.

Northern regions face a serious water shortage, with 130 cities facing extreme shortages.

China supports 21 percent of the world's population with just seven percent of its fresh water.

(Xinhua News Agency December 29, 2007)