Minister of Water Resources Wang Shucheng urged authorities to push water conservation efforts.

"Water shortages will become one of the country's most urgent challenges... in the next two decades,'' the minister warned yesterday at a national conference.

Problems have worsened in most urban areas as supplies shrink in more than 400 cities --60 per cent of the country's total -- while persistent droughts are endangering crops in rural areas.

Last year, China lost more than 30 million tonnes of grains. Some 34.6 billion yuan (US$4.1 billion) worth of cash crops were damaged by spring and summer droughts which hit most areas in the north and parts of the south, according to Wang.

The lossees were worse than the annual average caused by dry spells through the 1990s, the minister confirmed.

He was confident, however, that China has great potential to use water efficiently.

Over 70 per cent of its total water supply each year is used for irrigation while very little is recycled.

"Building a water-saving society will be the only fundamental outlet for China to tackle the issue today and maintain sustainable development in the future,'' the minister told local water officials attending the conference.

Wang asked local water authorities to set overall water use targets and assure basic water rations for users living in different areas or working in different industries and trades.

He also said the government will draft a water-saving programme based on pilot projects already carried out.

For example, the government of Zhangye, in Northwest China's semi-arid Gansu Province, has clearly defined and distributed water-use rights to safeguard a limited supply.

Wang hopes more areas will follow suit.

"Once such quotas are set, water agencies must put the water supply under control by legal, administrative, engineering, economic and technical means," he added.

Wang urged local governments to restructure their economy and industries in line with their regional water resources.

To propel the water-saving campaign this year "the prices of water will be used as a major way to force users to make full use of the limited water quotas they have paid for," Wang said.

He made it clear that, "under a market economy, rules will be set for users to transfer their water-use rights through open water trade market in a bid to optimize such precious resources in different regions."

The water chief pledged to ensure basic water use for needy urban and rural areas, ensure a permanent supply while protecting the environment.

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