The lake has formed behind a landslide late last month that blocked the Pareechu River, a tributary of the River Sutlej in Tibet, Indian satellite images show.

China has ruled out controlled blasting of the landslip to allow the water to gradually drain because of the area's mountainous terrain, the officials said.

Eight villages on the banks of the Sutlej in the northern Indian state of Himachal Pradesh, around 230 miles north of New Delhi, have been evacuated and 350 more villagers are threatened by floods.

Power supplies to northern India have been disrupted as one of three power plants at risk from flash floods has been partially shut down.

"About a thousand people living downstream of the Sutlej ... have been moved to safer areas," state Irrigation Minister Vidya Stokes said.

In 2000, a flash flood on the Sutlej killed more than 70 people and damaged around 100 bridges.

State Chief Minister Virbhadra Singh said the government and armed forces were keeping an hourly watch on water levels.

"The state administration is keeping a round-the-clock watch on the situation and people have been advised to move to higher reaches in the mountains," he said.

Bad weather and rugged mountain terrain have hampered efforts to find a way out of the mounting crisis on the Pareechu river, which flows into the Sutlej valley.

H.K. Sharma, director of the Nathpa Jhakri Hydel Project downstream from the lake, said negotiations were underway with Chinese authorities.

"A team of flood experts is awaiting permission from China in order to survey the Pareechu lake area and update the threat perception," he said.

"Recent satellite imagery has shown an increase in the lake area from 150 hectares on Aug 6 to 188 hectares today."

Power generation has been partly suspended at the Nathpa Jhakri project, which supplies around a third of the power to India's northern grid, because of the threat of the floodwaters, and the Rajiv Gandhi and Karcham-Wangtu projects are also at risk.