A fierce row has erupted between fishermen, the union and Government after the rusting Chinese ship, the Xing Da , was finally laid to rest on the sea bed.

Yesterday morning a dozen commercial fishing boats brushed with a Government tug as they threw a `picket' line of vessels around Marginal Wharf in a bid to stop the freighter setting out to sea.

The Bermuda Industrial Union accused Government of putting cash before the environment and ignoring advice from its own officials about where to sink the Xing Da .

Union bosses also accused Government of ordering the illegal crossing of the fishermen's `picket' line -- but they refused to comment on whether it could lead to industrial action.

But Government said the site picked for the sinking was the best available and was chosen after months of consultations.

Government and divers also accused the fishermen and union of only raising concerns within the last two weeks -- and not months ago when talks first started.

And they said they were acting legally in moving the ship -- and it was the fishermen who acted illegally by trying to interfere with the vessel's navigation.

Yesterday amid thunder and lightning the Xing Da was finally laid to rest in 100 feet of water several miles off Dockyard, in Eastern Blue Cut.

The ship sank in just a few minutes -- although about one-third ended up resting on the coral reef instead of in the sandhole earmarked as the resting place.

A small flotilla of Police, Marine and Ports, diving, sightseeing and fishing boats -- witnessed the ship slip quietly below the surface.

It was the end a long journey for the vessel which set sail from China last July only to be captured by US Coast Guards the following October in a sting operation that broke a US smuggling ring.

The ship's 83 Chinese passengers and 26 crew were taken off the boat when she was towed into Bermuda's waters and eventually flown back to China.

Three people were arrested in North America and charged in connection with running an illegal ring dealing in smuggling humans into the US. Yesterday morning the Government tug Powerful began towing the Xing Da from Marginal Wharf where it had been cleaned.

However 12 commercial fishing boats formed a picket line to prevent the ship leaving. Some fishermen also tried to cut the tow line.

Junior Bean, secretary of the BIU's fishermen's division, said as the fishermen were waiting to talk to officials the tug got underway.

"The tug powered up its twin screws and started throwing the boats around like tin cans. Five boats were damaged, but no-one was injured,'' added Mr.

Bean, who said the tug and ship then moved off.

"The breaking of a picket line is illegal,'' he said, although neither he not BIU president Derrick Burgess would comment on whether the union now planned any industrial action.

Mr. Burgess said the union and fishermen were not against the sinking of the Xing Da but were against the site chosen which could harm reefs and affect migrating fish, as well as flying fish and lobster.

"The Government has proven its contempt for the preservation of Bermuda's environment.

"Against recommendations of concerned fishermen, its own marine resources group and several other groups Government ensured that the Xing Da was laid to rest on an area which will surely be detrimental to Bermuda's ecological system,'' added Mr. Burgess.

He claimed the director of Agriculture and Fisheries John Barnes was against the site which was suitable for experienced divers only. Mr. Barnes was not available for comment last night.

"What's at issue is not power and not individuals, but the firm belief that in order to preserve our homeland we must preserve our ecology,'' said Mr.

Burgess.

Last night Ron Ross, the director of Marine and Ports, admitted that part of the Xing Da came to rest on the reef.

"It was not planned, but it was not guaranteed either. We could only control it to a certain extent,'' said Mr. Ross.

Chinese ship sunk He added: "The operation to take the vessel out from Marginal Wharf and sink it was legal. We were carrying out the orders of the Government. To impede navigation is unlawful.'' About 30 percent of the boat is sitting on the reef and a full survey of any damage to the coral has not yet been carried out.

However Mr. Ross said it was a successful sinking on a site that had been chosen after months of investigation.

Environment Minister Irving Pearman said he was "disappointed'' by the fishermen's actions and said their arguments about the site were "specious''.

"I spoke to Derrick Burgess last Monday and he did not present any more arguments'' said Mr. Pearman.

The Minister said the normal restricted zone placed around a wreck had been reduced to help fishermen, that in-depth investigations had taken place to locate a site and that the Marine Resources Board was satisfied.

"I was disappointed. It seemed to be demonstrating for the sake of demonstrating,'' added Mr. Pearman.

Last night one of the men behind the plan to sink the Xing Da , diver Michael Burke, also dismissed the fishermen's concerns.

"This area is no different to any other area around the Island as far as diving is concerned.

"Obviously there was going to be damage to the reef, but there is so much reef around Bermuda, it is difficult to find somewhere that is clear.'' Mr. Burke added: "There was no need for anything negative or confrontations.

Everyone could have worked together and done something positive.''