Miyun and Guanting reservoirs, which supply water to almost 7 million Beijing residents, have been listed as top water-quality protection areas, the government said Thursday.

Also, seven companies, including Beijing Capital International Airport, will be required to install automatic wastewater monitoring devices.

A circular by four ministries on a plan to better protect the reservoirs and six major rivers in China for the period 2006-10 was made public yesterday.

The Haihe River Basin, where Beijing is located, is defined as "severely polluted". Thirty cities discharge more than 150 million tons of wastewater into the basin a year. Beijing also suffers from an acute water shortage - less than 300 cu m a year per individual - this is about one-eighth of the national average.

"The water quality of Beijing, as the host city of 2008 Olympics, looms large and it obviously has to be improved," the plan said.

The plan focuses on protecting water resources, reducing the discharge of waste, and treatment of wastewater.

Industrial companies have a major role to play in achieving these goals.

By 2010, all chemical and papermaking factories will be subjected to clean production inspections.

Some 3 billion yuan ($429 million) will be spent on building and upgrading 19 wastewater plants, and a waste mud treatment center, to provide sufficient, clean water to people in Beijing.

The Beijing water bureau said great efforts have been made on saving and recycling wastewater to ease the water shortage problem.

"The water usage rate is 50 percent, and the wastewater treatment rate 90 percent, the highest in the country," Yu Yaping, an official from the bureau told China Daily.

"Beijing is the first to meet the 106 requirements of the national drinking water standard, which is stricter than the US standard, so its is safe to drink the city's water," he said.

The plan also recommends a punishment system be established for people whose decisions cause severe environmental accidents or break environmental laws.