* Countries at odds over Ethiopia's hydro project
* Egyptian politician urged Mursi to destabilise Ethiopia
* Addis Ababa says dam won't affect river's flow
Ethiopia's construction of a dam on a tributary of the Nile is not open to negotiation, the Addis Ababa government said on Friday, as a confrontation with Egypt over the project escalated.
The Cairo government said this week it would demand the project be halted, after its southern neighbour began diverting a stretch of the river to make way for the $4.7 billion dam that will become Africa's biggest hydropower plant.
Ethiopia said it had summoned Egypt's ambassador to explain comments by politicians in Cairo advising Egyptian President Mohamed Mursi to take hostile action to halt the building of the dam.
A spokesman for Ethiopian Prime Minister Hailemariam Desalegn said Cairo's position on the dam was unclear and its concerns were often not based on science.
"In any case, demanding a halt is simply a non-starter. It's not subject to negotiation," spokesman Getachew Reda told Reuters.
Countries that share the Nile have argued over the use of its waters for decades, repeatedly raising fears that the disputes could eventually boil over into war.
Ethiopia has set out plans to invest more than $12 billion in harnessing the rivers that run through its rugged highlands and to become Africa's leading power exporter.
Now 21 percent complete, the Grand Renaissance Dam will eventually have a 6000 megawatt (MW) capacity and is central to Ethiopia's plans to become Africa's leading exporter of power.
Cairo argues that Ethiopia has not properly considered the dam's impact on the river, saying that a report put together by experts from Egypt, Sudan and Ethiopia is inadequate.
The Cairo government suffered embarrassment on Monday when senior Egyptian politicians called in to discuss the crisis were apparently unaware their meeting was being broadcast live on television.
One suggested spreading false rumours that Egypt was building up its air power. Another, Younis Makhyoun, leader of a Salafi Islamist party, was filmed saying Egypt should back rebels in Ethiopia or, as a last resort, destroy the dam.
"Whether sabotage will be on menu, that remains to be seen," Getachew said, adding that past attempts by Egypt under former president Hosni Mubarak to destabilise Ethiopia through support to insurgents had failed.
"Destabilising Ethiopia never worked even when we were at our weakest position in the past," Getachew said. "We are in a far better position to avoid any negative impacts that may come from Egypt or any another country."
Even so, Getachew rejected the possibility of conflict and said he hoped Mursi would "be on the side of reason".