Tribune News Service

New Delhi, June 18

In what could be a sign of things to come, two large public sector undertakings are on the verge of cancelling contracts given to Chinese companies, including some linked to the People’s Liberation Army which had killed 20 Indian soldiers in a clash in Galwan Valley.

In one case, the ostensible reason for the railways deciding to terminate the contract of a Chinese company is poor progress. But “ownership pattern” is the cause for BSNL being asked not to permit Huawei and ZTE to participate in the tenders for upgrading the 4G network.

The railways contract of Rs 471 crore to Beijing National Railway R & D Institute of Signal on the Eastern Dedicated Freight Corridor, that is itself making slow progress, is being cancelled for completing only 20 per cent of the work so far.

In case of telecom sector project, Department of Telecom (DoT) has hinted at the “ownership pattern” of the two Chinese telecom companies as the reason for asking BSNL to steer clear of them. The DoT may also ask private companies to also not use equipment by such Chinese companies. Both Huawei and ZTE have faced hurdles in other countries because their owners have had connections to PLA.

In case of the railways, officials cite poor performance and inability to deliver the project on time as the reasons since it is a World Bank-funded project. Dedicated Freight Corridor Corporation Limited (DFCCIL) has already written to the World Bank for terminating the contract. The Chinese company is also being charged with not sharing technical documents and not posting engineers at the project site.