India-China face-off: DFCCIL to scrap Rs 471-crore order awarded to Chinese firm

• The order had been given to Beijing National Railway Research and Design Institute of Signal and Communication Group in 2016

• According to an official spokesperson from the Ministry of Railways, the contract is being terminated due to non-performance of the Chinese firm

New Delhi: In the backdrop of an escalation in Indo-China border confrontation, state-owned DFCCIL (Dedicated Freight Corridor Corporation of India Limited) is set to strike down an order worth Rs 471 crore awarded to a Chinese company, an official spokesperson for the company told PSU Watch. The decision to terminate the contract was taken by the Indian Railways on Thursday. The contract pertained to the completion of signalling and telecommunication work in 417-km-long Kanpur-Deen Dayal Upadhyay section in Uttar Pradesh and has been cancelled due to 'poor progress.'

The order had been given to Beijing National Railway Research and Design Institute of Signal and Communication Group in 2016.

DFCCIL approaches World Bank to begin termination of order

The spokesperson said that DFCCIL has approached the World Bank — which is the funding agency for the project — to begin the process of terminating the project. According to an official spokesperson from the Ministry of Railways, the contract is being terminated due to non-performance of the Chinese firm. There had been only 20 percent progress in the project in the last four years, said the spokesperson. Non-availability of engineers at the site, the company's reluctance to provide technical documents as per contract, no improvement in progress, despite repeated meetings with the officials, are some of the reasons listed by the Ministry on which it based its decision.

The backdrop

The news comes a day after reports suggested that the DoT (Department of Telecommunications) had asked BSNL (Bharatiya Sanchar Nigam Limited) to not use 4G equipment from Chinese companies to upgrade its 4G facilities. Tension along the LAC (Line of Actual Control) have been on the rise as India had China engaged in a violent face-off in the Galwan area of Ladakh on June 15. At least 20 Indian soldiers have been killed in the skirmish.