This April 2, 2013, photo shows the construction of the Grand Ethiopian Renaissance Dam in Asosa Region, Ethiopia (Photo: AP)
The notion that the Renaissance dam will harm Egypt is an "unrealistic conception," according a spokesperson for Ethiopia's foreign ministry.
Dina Mofti said Addis Abbas seeks to "enhance its peaceful relationships" with neighbouring states, state news agency MENA reported on Wednesday.
Last June, the Ethiopian parliament ratified a controversial treaty designed to ensure its access to Nile water resources, replacing a colonial-era agreement that granted both Egypt and Sudan the lion's share of water rights from the river.
According to AFP, the new arrangement allows upstream countries to implement irrigation and hydropower projects without seeking the approval of Cairo.
Egypt and Sudan have not signed the so-called Cooperative Framework Agreement (CFA) led by the Nile Basin Initiative. Ethiopia inked the deal in May 2010, and its ratification by parliament comes amid rising tensions between Addis Ababa and Cairo over Ethiopia's construction of the Grand Renaissance Dam on the Blue Nile
Ethiopia began diverting the Blue Nile in May, paving the way for the construction of the $4.2 billion (3.2 billion euro) dam, set to become Africa's biggest hydroelectric dam when completed.
The Ethiopian foreign ministry said earlier that the ratification of the CFA, also known as Entebbe agreement, was an "important step towards the equitable use of the Nile waters."