Chinese firm’s Rs 470 cr contract to be cancelled, says railway amid Ladakh face-off

In a release announcing cancellation of the contract, the DFCCIL said that the company has only completed 20 per cent of the work in four years.
The ongoing work at one of the project sites of DFCCIL near Delhi.(Twitter/@dfccil_india)
The ongoing work at one of the project sites of DFCCIL near Delhi.(Twitter/@dfccil_india)
Updated on Jun 18, 2020 07:28 PM IST
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Hindustan Times, New Delhi | | Edited by: Amit Chaturvedi

The Indian Railways’ Dedicated Freight Corridor Corporation of India Limited (DFCCIL) has decided to terminate contract with China. The signalling contract was given to Beijing National Railway Research & Design Institute of Signal & Communication in the year 2016.

The Chinese company was meant to complete the signalling and telecommunication work the 417-km long Kanpur-Deen Dayal Upadhyay section. The project cost was Rs 471 crore.

The decision was taken because the Chinese firm had only completed 20 per cent of the work in four years.

Officials said the Chinese company was reluctant to furnish technical documents as per contract agreement. Also, the Chinese firm has not been able to provide engineers/authorised personnel at the site which was a serious constraint.

“There have been meetings at every level, but no improvement in progress,” one official said.

The announcement comes after a face-off between India and China in the Ladakh region in which 20 Indian soldiers were killed. India is mulling economic measures to counter Beijing, people familiar with developments said.

A railway official, however, underlined that the decision was taken way back in April.

For the contract to be cancelled, New Delhi will, however, need a non-objection certificate (NOC) from the World Bank.

At least 100 Chinese products are staring at anti-dumping action and future investments from China, including participation of its firms in big and important projects such as the 5G market, could be barred, four government officials said, asking not to be identified.

India will, however, not resort to any knee-jerk reaction. It will take well considered action at an appropriate time, necessary to protect integrity and sovereignty of the country and its national interest, the officials added.

“Hopefully, good sense will prevail (upon China). We have several options and we will not hesitate to exercise them depending on the situation,” one government official said.

Traders are also against China. The Confederation of All India Traders (CAIT), a powerful lobby of 70 million local traders, has decided to step up its nationwide movement against the boycott of Chinese goods, CAIT national secretary general Praveen Khandelwal said.

Both ministries of finance and commerce are already taking action against the influx of Chinese goods that is injuring domestic industry.

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