At least five million Tehran residents need to relocate elsewhere because Iran's capital sits on several fault lines and is threatened by earthquakes, President Mahmoud Ahmadinejad said on Sunday.

"We cannot order people to evacuate the city... but provisions have to be made. At least five million should leave Tehran so it is less crowded and more manageable in case of an incident," Mehr news agency quoted him as saying.

Ahmadinejad said the government could offer "land, loans at four percent interest and substantial subsidies" in the provinces to encourage Tehran residents to leave the sprawling capital.

Tehran province has nearly 14 million inhabitants, eight million of whom live in the city which straddles several fault lines. Experts warn that a strong quake in Tehran could kill hundreds of thousands of people.

Ahmadinejad said that 67 percent of Iran's 74-million-strong population lives in urban areas.

"We cannot predict when an earthquake will happen. But if anything happens to Tehran province's 13.8 million residents how can we manage that?" he asked.

Iran is prone to frequent quakes, many of which have been devastating.

The worst in recent times hit the southern city of Bam in December 2003, killing 31,000 people -- about a quarter of the population -- and destroying its ancient mud-built citadel.