The Lands Department has also agreed to a request for a symbolic land premium.

The mosque, to be the first catering for 7,000 Muslims in the New Territories, was approved by the government in 1997. After years of consultation, the letter of intent confirming the lease is scheduled to be released in April.

Joseph Chow Kam-siu, vice-chairman of the North District Council, said about 50 to 60 Tsui Lai Gardens residents protested against the plan in meetings two years ago.

'Basically, the residents remain divided. But those protesters led by fellow councillor Liu Chiu-wa have become silent because the district council voted for supporting the government's decision.

'I think that if the religion is Christian or Buddhist, the residents wouldn't have such great problems. We thought banning it would be some form of discrimination against their religion.'

Mr Liu refused to say whether he still opposed the plan.

Mohamed Allidin, chairman of the United Muslim Association of Hong Kong, said he was relieved his proposal for the mosque could go ahead.

In the early 1990s, Mr Allidin suggested using private land for the mosque, but the government said the managers of nearby Taoist and Buddhist temples objected. 'I can say it is a form of discrimination. But we do not want to antagonise any residents,' he said.

He then came up with the idea of opening up the land for use by people other than just Muslims by building a complex with the mosque, a home for the elderly, a primary school and a kindergarten. About $100 million will be raised in the Middle East.

'The only thing I hope is the government will allow us to pay a nominal rent, the same level as other religious organisations pay, because we are a non-profit organisation,' he said.

The Muslim community has grown from 100,000 a decade ago to more than 250,000, with at least 7,000 living in the New Territories.

A Lands Department spokesman said the land premium would be symbolic because the home for the elderly would involve other bureaus' policy support.