Railway to terminate ₹471 crore signalling contract of Chinese firm

Move comes a day after DoT decided to ask BSNL, MTNL to not use gear by Chinese firms in 4G upgradation

Updated - June 19, 2020 06:26 pm IST

Published - June 18, 2020 05:39 pm IST - New Delhi

The Railway cited 'poor progress' as the reason for the termination

The Railway cited 'poor progress' as the reason for the termination

The Dedicated Freight Corridor Corporation of India Ltd. (DFCCIL), a special purpose vehicle under the Railway Ministry, on Thursday decided to terminate a ₹471 crore signalling contract given to a Chinese firm.

While the decision follows the violent clash between Indian and Chinese soldiers along the Line of Actual Control (LAC) in Ladakh, the Indian Railways said the contract was being terminated due to “poor progress.” The move also comes a day after the Department of Telecom decided to ask the two state-run telcos — BSNL and MTNL — to not use gear by Chinese firms in its 4G upgradation .

The contract for ‘signalling and telecommunication work’ for the 417 km section from Kanpur to Mughalsarai on the Eastern Dedicated Freight Corridor was awarded to Beijing National Railway Research & Design Institute of Signal & Communication Group in 2016.

Technical documents

According to the Indian Railways, despite passage of four years, only 20% of the work has been completed. A railway official added that the company showed “reluctance” in furnishing technical documents, as per the contract agreement, such as logic design of electronic interlocking.

Additionally, the company’s engineers or authorised personnel were not available at the project site which was a “serious constraint,” the official said, adding that the physical work could not progress at the site as the firm failed to tie-up with local agencies. “There is no improvement in progress despite repeated meetings with them at every possible level,” the official said.

“In view of the poor progress, it is decided by DFCCIL to terminate this contract,” the official said. The DFCCIL has reached out to the World Bank, the funding agency for the Eastern Dedicated Freight Corridor, to initiate the process.

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