Seven people were arrested and 20 injured after clashes broke out in Shiyuan, Sichuan province , on Friday between armed police and thousands of protesters angry about a brewery polluting drinking water, says a Hong Kong-based human rights group. The Information Centre for Human Rights and Democracy said yesterday that residents of Shiyuan fought a 'violent and bloody' battle with police at about 7pm after they took to the streets demanding that Hong Kong-listed China Resources (Shifang) Breweries immediately stop releasing effluent into rivers nearby. A local source confirmed the report yesterday, saying villagers were angry at both the factory and the local government. 'The water contamination was probably the main reason why so many people protested,' the source, who asked not to be named, said. 'But protesters also demanded that town leaders say whether they had been bribed to keep quiet about the pollution.' The source said she had heard a rumour that the factory had paid the government 'compensation' for polluting local water sources. So far the local government has made no comment on this. Another source, who also did not want to be named, said some people were angry about the way the brewery treated its workers. 'The brewery has fired many locals for no reason and failed to make social insurance payments,' the source said. 'There's a lot of bad blood between the factory and local people,' he said, adding that residents were also angry that the company had started hiring people from out of town. Phone calls to the China Resources Enterprise and the Shifang police went unanswered yesterday. The human rights group said China Resources Enterprise, which bought the brewery for 2.5 billion yuan in January, had been increasing the factory's production. More than 70 per cent of the mainland's above-ground waterways and 90 per cent of its underground waterways are classified as polluted, according to official data.