BEIJING, Dec. 12 -- Over 1,400 kilometers of canal and pipeline began carrying water on Friday from China's longest river, the Yangtze, directly to the country's arid northern regions, including national capital of Beijing.

Completion of the scheme is major progress in the enormous south-north water diversion project, costing an estimated 500 billion yuan (about 80 billion U.S. dollars) and the largest of its kind in the world.

President Xi Jinping sent his congratulations to workers and people "who have made contributions" to the middle route project on Friday, calling the achievement a "major event" in the nation's modernization drive.

He said the success has come through ceaseless effort by hundreds of thousands of people. Construction began on Dec. 30, 2003.

Xi described the project as important strategic infrastructure to optimize water resources, boost sustainable economic and social development, and improve people's livelihoods.

The south-north water diversion project is another gargantuan feat of Chinese engineering, in the style of the Beijing-Hangzhou Grand Canal, the world's longest man-made river, constructed in the 13th century to transport grain between the south and north.

Water will eventually flow via eastern, middle and western routes via canals, pipelines and tunnels. It took eight years for engineers and workers to complete two 4,000-meter-long tunnels under the riverbed of the Yellow River, China's second largest.

The first-stage project of the eastern route went into operation last year, sending water to Shandong province. By 2050, as many as 440 million people could benefit from the diversion of 44.8 billion cubic meters of water each year.

The middle route's first-stage project begins at Danjiangkou reservoir in central province of Hubei and runs for 1,432 kilometers. It will supply 9.5 billion cubic meters of water per year to some 100 million people in the dry northern regions, including the cities of Beijing and Tianjin, and provinces of Henan and Hebei.

The water will cater to household, industrial and agricultural demand, benefiting more than 100 counties.

President Xi urged the route's management to protect the quality of water and to save water. Work still needs to be done to ensure the livelihoods and employment of those displaced for the construction.

More than 200,000 workers participated the construction and over 400,000 were displaced, including 345,000 people whose hometown was submerged at part of the massive Danjiangkou reservoir.

Premier Li Keqiang said the project will benefit both current and future generations, and urged the projects management team to ensure the security and stability of supply.

The project was conceived by late Chinese leader Mao Zedong in 1952 but only approved by the State Council in December 2002, after nearly half a century of debate.

The huge project has been widely hailed as an example that the Chinese people are capable to better their lives through hard efforts. But with the new waterway come new challenges, such as protection of water quality and unforeseen natural risks in the future.