A government panel tasked with assessing an ambitious multibillion dollar scheme to interlink India's rivers to reduce water shortages said yesterday it would soon start examining the country's waterways.

The eight-member panel headed by former power minister Suresh Prabhu also decided to hold talks with all states that suffer either from drought or flooding, and study selected river systems to prepare a detailed project report, the Press Trust of India (PTI) news agency reported.

"The main objective of the programme is to ensure the country against water stress and create a greener India," said a statement released by the panel and quoted by PTI.

The river linkage would happen only after an examination of the project's ecological and financial viability, the statement said.

The panel was set up by the government last year after a drought hit many states.

According to India's Ministry of Water Resources, the project report is expected to be completed by 2006, with the linkage possibly finished by 2016.

Indian Prime Minister Atal Behari Vajpayee last month warned that water was likely to become very expensive in the future in the absence of conservation efforts.

"Conservation of water was so essential that if steps were not taken to do so now the day was not far off when people would fight over it," he said.