A leading human rights group urged Nicaragua on Friday to abandon plans for a massive interoceanic canal, saying it poses a threat to people, forests and Central America's largest lake.

The International Federation for Human Rights (FIDH) said President Daniel Ortega's government had trampled on the people's rights in its rush to seal a deal for the $50-billion project with the Chinese investor behind it, Wang Jing.

"Respecting nature and the rights of rural communities is not a luxury. It's a duty," said the Paris-based group's president, Dimitris Christopoulos, in a statement.

"These projects will have a dramatic impact on the environment and on human rights. It is unimaginable to sell off territory as such. The government must back out."

Nicaragua's leftist government has granted Wang's consortium, HKND, a concession to build a canal from the Atlantic to the Pacific and operate it for 116 years.

It is meant to rival the Panama Canal, which handles five percent of global maritime trade but is showing its age at 102 years old, despite a recent expansion.

But activists warn the Nicaragua canal will cause an environmental catastrophe by destroying vast forest lands and endangering Lake Cocibolca, which 80,000 people rely on for their water.

The FIDH, a federation of 180 rights group worldwide, warned that Nicaragua risked committing "numerous human rights violations" by pushing ahead with the canal.

They include expropriating land with "blatantly insufficient compensation" and uprooting up to 120,000 small farmers, it said.

Already, the police and military have "severely repressed" protests against the canal, it said.

Nicaraguan authorities contacted by AFP declined to comment on the report, which FIDH said was based on interviews with 131 residents along the canal route and a legal analysis of the concession granted to Wang's companies.