BEIJING, Dec. 12 -- The water shortage in China's capital is set to reach crisis point in 2010, when the population is expected to top 17 million -- at least three million more than its resources can feed.

An optimistic estimation of Beijing's annual water supply is around 3.73 billion cubic meters in 2010, taking into account Yangtze River water supplied by the country's ambitious south-to-north water diversion project.

Yet the disposable volume will be no more than 3.26 billion cubic meters excluding at least 470 million cubic meters needed to maintain the city's ecological system, says a report in China Economic Weekly.

"The total number of people this water can feed depends on living standards and water consumption for each unit of gross domestic product," it said.

Beijing's per capita GDP averaged 5,547.6 U.S. dollars last year, with 50.1 cubic meters of water consumed for each 10,000 yuan (1,250 U.S. dollars) of GDP.

Based on this formula, Beijing's water resources were able to feed a maximum of 14.36 million people in 2005, the report said.

But Beijing had more than 15 million permanent residents and four million migrants at the end of last year, and the consequences of overpopulation include the continuous decline of groundwater and a worsening environment.

In line with China's blueprint to improve energy efficiency by 2010, the municipal government has vowed to increase its per capita GDP to 8,000 to 8,500 U.S. dollars and cut water consumption for each 10,000 yuan of GDP to 40.08 cubic meters, down 20 percent from the 2005 volume.

If these goals are to be fulfilled, Beijing will be able to accommodate between 13.37 million and 14.20 million people in 2010.

But demographers say the city's permanent population will have exceeded 17.13 million by then.

With the current baby boom triggered by superstitious beliefs that people born in the Chinese years of the dog and pig -- this year and next -- are lucky, experts have little hope for a slowdown in Beijing's population growth, even considering the post-Beijing Olympics lull and boom towns in neighboring Hebei Province and Tianjin Municipality.

An emerging business development zone in Tianjin and a new manufacturing center in Caofeidian, Hebei, are expected to accommodate some of Beijing's working population and foster economic development in north China.

So in order to feed an additional three million people with its limited water resources, experts say Beijing needs to further slash water consumption for each 10,000 yuan of GDP to 33, or even31 cubic meters, down 35 to 38 percent from the 2005 level.

But that would result in water rationing and higher prices that would affect the quality of the average resident's life.

The ceiling on Beijing's population, set by the central government in 2004, is 18 million in 2020.

One approach to cap the city's population is relocate some people.

With less land available for real estate development and soaring house prices, some home buyers are indeed forced to move to areas on the border of Beijing, Tianjin and Hebei Province.

The city government has also implicitly encouraged people, retirees in particular, to live in Hebei. But those who do often complain of isolation, with few nearby friends and little access to public services such as banking, supermarkets and buses that were once an indispensable part of their lives.

The China Economic Weekly report said the key to containing Beijing's bulging population would be to reduce the city's reliance on the population size in economic growth.

This reliance is calculated with the "population coefficient", or the ratio of permanent population to the city's GDP. Beijing's reliance on population is 4.6 times that of Hong Kong and 1.13 times the Shanghai level.

"In fact, if Beijing's 2005 reliance on population was reduced to the Shanghai level, it would need 1.7 million people fewer to boost its development," the report said.

A decreased reliance on the working population means increased productivity, in which Beijing lags far behind Shanghai. Beijing's productivity is only one eighth the level of developed countries and around a third of the Republic of Korea's level, it said.

Meanwhile, the city government is also pinning its hopes on newpolicies of the central government to seek more balanced national economic growth and make other provinces as appealing as Beijing in terms of opportunities for education and employment.