China is poised to release an action plan to combat water pollution, following its clean air action plan issued in last September.

The Action Plan for Water Pollution Prevention and Control, with a 2 trillion yuan ($320 billion) package in place, will be implemented to reduce pollution emissions, improve drinking water safety, and promote eco-friendly industries, said Li Ganjie, vice minister of the Environmental Protection, at a press conference on June 4.

China's water pollution has been sounding alarms for years, posing a huge threat to public health.

Official statistics show that 10 percent of the country's surface water is rated "seriously polluted." In some areas, over 39 percent of the surface water is under extreme conditions. In 2012, 31 percent of rivers and 39 percent of lakes didn't meet the standard for drinking water, and emergencies caused by unsafe drinking water have been on the rise.

The pollution comes from three major sources: urban living, industry and agriculture. Of the three sources, pollution from urban living rose to 67.6 percent in 2012.

The emissions have greatly exceeded the environment's carrying capacity. According to the Ministry of Environmental Protection, a cut of at least 30 percent of pollutants is needed to see a positive change in water quality.

Domestic and foreign companies and investors are eying China's market for pollution treatment, recycling and eco-friendly products. The Asian Development Bank and the Beijing Enterprise Water Group kicked off a project last year to recycle and reuse polluted water for industrial cooling and urban irrigation.