Railway Ministry PSU Cancels Rs 471 Cr Telecom Equipment Contract With China-Based Company

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  • The central government might also scrap 4G telecom tenders to keep Chinese companies away
  • Tensions between the defense forces of China and India are increasing on the border

Dedicated Freight Corridor Corporation of India (DFCCIL), a Ministry of Railways PSU, has terminated a contract worth Rs 471 crore (Cr) with China-based Beijing National Railway and Research Group. The latter, as part of the contract, was to supply signaling and telecom equipment to the former.

Interestingly, China during the April to December 2019 period, has been the second-largest trade partner of India. The United States lead the list. Trade between India and China amounted to a total of $64.96 billion during the mentioned period.

Imports from China rising

India’s imports from China have been increasing at a steady rate. In contrast to 13.7 per cent imports made by India from China in 2018-19, the same figures stood at 14.1 percent in 2019-20. On the other hand, India only exported three per cent during the period. Engineering goods, auto components and electronics are among the list of most imported things from China.

Not only has China has become a global supplier of products critical for manufacturing electronics, power generation and automobiles, it has also secured a good place in the world’s solar power industry. The share of Chinese-companies in India’s solar sector stands at around 78 per cent currently.

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At least three of the top five smartphone brands in India, are from China. Chinese also supply display panels and other critical components to India-based companies.

Secretary of State (US) Mike Pompeo, in December 2019, had informed about discussions on the 5G issue during the second edition of the 2+2 ministerial dialogue between India and the US. Representatives from both the countries discussed the risks China-made 5G communication networks to India and the US.

US Commerce Secretary Wilbur Ross had also warned India about overusing Huawei’s 5G equipment. He had mentioned that the U.S. hopes India “does not inadvertently subject itself to untoward security risk” by using 5G equipment from the Chinese tech giant.

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