The Department of Trade and Industry (DTI) is backing the UK company Balfour Beatty with £200m in a bid to build the Ilisu Dam on the River Tigris.

The project has been criticised by environmentalists, the World Bank and Turkey's neighbours.

The dam's reservoir will drown dozens of Kurdish towns along the Tigris valley, including the historic town of Hasankeyf.

The project cuts a swathe through Kurdish areas

Work is underway or complete on 22 dams on the Tigris and Euphrates rivers. Turkey says the dams will enable hundreds of thousands of hectares of land to be irrigated, and generate electricity for the underdeveloped and arid southeast of the country.

The World Bank refused to participate in the project because of fears it would increase the danger of cross-border conflict with Turkey's neighbours to the south.

Turning on tension

Turkey controls the Tigris and Euphrates headwaters which Iraq and Syria depend on for fresh water.

Both Baghdad and Damascus have complained about the amount of water they have been getting since the completion of the first Turkish dams at the beginning of the 1990s.

They fear Turkey's ability to shut off their water supply in any possible future conflict.

Pergau Dam: Environmental damage and arms deals

Critics of British support of the Ilisu Dam say it contravenes the UK Government's rules on ethical foreign policy and its recently announced environmental guidelines.

Tony Juniper of the UK-based environmentalist group Friends of the Earth said: "We have to stop this project before the British Government is party to fermenting war in the Middle East."

In the late 1980s, Balfour Beatty was involved the controversial Pergau Dam project in Malaysia.