China has begun relocating 330,000 people as part of a massive project to divert water from the Yangtze River to the drought-prone north including the capital Beijing, state media said Thursday.

The South-North Water Diversion Project is the country's largest relocation programme since the building of the Three Gorges Dam, which involved the relocation of 1.27 million people, the official Xinhua news agency reported.

Authorities began moving the first 500 residents on Wednesday in central Hubei province, the report said. A total of 180,000 people in Hubei and 150,000 in neighbouring Henan province are being forced from their homes.

"We felt sorrow when the whole village gathered to have our last dinner in our hometown together," a resident surnamed Wang was quoted as saying.

Wang's town in the Niuhelin district of Danjiankou city will be submerged by 2014 under 170 metres (560 feet) of water, the report said.

A fleet of 15 buses carried the residents away, followed by 34 trucks loaded with their belongings and a number of ambulances carrying the village's sick, elderly and pregnant.

"We may set a record in terms of speed of relocation — 60,000 people within 50 days. We want to do it fast so we can finish it before the rainy season hits," Danjiangkou mayor Zeng Wenhua was quoted as saying.

The people were being moved to new homes 300 kilometres (185 miles) away, and will receive a one-off payment plus government subsidies for the next 20 years, the report cited Zeng as saying, without specifying amounts.

Chinese revolutionary leader Mao Zedong is credited with coming up with the idea for the massive diversion project, which will feature a 1,890-kilometre eastern canal and a 1,430-kilometre central section.

Critics have said the project could be a huge waste of resources that risks creating new water shortages and sparking environmental disasters.

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