The suspect, identified only as Wong, was in a serious condition in Princess Margaret Hospital last night.

Community leaders questioned whether opening fire in the public area, where many residents, mostly elderly, gathered was appropriate.

But assistant Kwai Tsing district commander Superintendent Anthony Law King-fu, said initial investigation showed the sergeant was justified in opening fire as the two elderly women were in danger.

He said the officer fired the shots at a distance of two to three metres from the suspect on two occasions.

The drama began when three Police Tactical Unit officers stopped the man for an identity check outside Wang Ching House, Cheung Wang Estate, at about9.30am.

The man tried to attack the sergeant with a knife, forcing the officer to step back. The three policemen, who were unhurt, drew their extendable batons, but the suspect ran off. It was also suspected he was carrying a bottle of bleach.

He ran across a footbridge in Liu To Road and downhill towards the bus terminal of Cheung Hang Estate.

During the pursuit, the three officers shouted warnings to passers-by saying, 'He has a knife. Stay away', police said.

A woman said: 'Police shouted ordering the man to stop, but he continued to run. He once slowed down drinking what looked like bleach during the pursuit.'

After a 200 metre chase, he was seen running towards three or four residents near a bus terminal in Cheung Hang Estate.

'An elderly woman was responding very slowly. She was in no position to defend herself,' Mr Law said.

'The sergeant thought there was immediate danger to the woman. After a warning was ignored, he fired one shot. It missed.'

After another 100 metres, the man ran towards another group of elderly residents outside Hang Yip House.

Police said he was approaching an elderly woman and the sergeant gave another warning. As the man ignored the warning, the sergeant fired another shot, hitting his hip. He sat on the ground and officers guarded him, with their revolvers drawn.

'From the beginning to the end of the whole incident, the man carried the knife in his hand. After being shot, he still held the knife in his hand,' the superintendent said. Officers had to disarm him before handcuffing him.

Mr Law said the sergeant opened fire in two 'identical' situations, when the suspect was metres away from an elderly woman. 'He made a decision [to shoot] in one or two seconds. Initial investigation showed that his decision was correct.'

Lawmaker James To Kun-sun said an investigation was needed to find out whether the sergeant's actions were justified. 'It is necessary to find out whether other options like the use of extendable batons, shields or pepper spray could have been used instead of opening fire,' he said.

A Kwai Tsing district councillor Lui Ko-wai said: 'At the scene of the shooting, it is usually a crowded place. There are about 20 to 30 residents - mostly elderly citizens - gathering there after taking their grandchildren to school. The scene is also the only exit for residents from Hang Chi House.'

A police spokeswoman said the man was arrested for possession of an offensive weapon and attempted wounding. Last night, he was under police guard in the custodial ward.

Under fire

How the Tsing Yi shooting unfolded

1 Suspect tries to stab police sergeant during stop and search in Cheung Wang Estate and then flees

2 Sergeant fires shot at knife-wielding suspect as he runs towards elderly woman, but misses

3 Sergeant shoots again at suspect as he runs towards group of elderly people, hitting him in hip