Indian Railways
Representative image. Image credit - Business Today

A Chinese company- Beijing National Railway Research & Design Institute of Signal and Communication Group Co Ltd- on Thursday has lost an Indian Railways’ contract that it won in 2016

This comes a day after the Telecom Ministry asked the Bharat Sanchar Nigam Limited (BSNL) not to use any Chinese-made equipment while upgrading its 4G facilities.

The Chinese company’s contract was to design and install signal and telecommunication network for the 417 km long dedicated eastern freight railway corridor (DEFRC) segment between Kanpur and Deen Dayal Upadhyay Station in Uttar Pradesh.

According to a report by India Today, the Ministry of Railways in a note has underlined that even 4 years of the contract, the company has completed only 20 per cent of the work.

This is why the nodal agency for freight corridors DDFCIL decided to terminate the contract.

The note further mentions a series of charges against the company, the primary being that the company has refused to “furnish technical documents on the logic design of electrical interlocking as per the contract agreement”.

A senior rail ministry official informed that the company, after a series of meetings, shared the details of the software and codes used to correct errors in railway signal and telecommunication systems.

These codes, however, were in the Chinese language and were incoherent and incomplete.

The official further said that the Indian Railways was worried over the refusal by the company to share details of the software and data.

The official further added that there was a fear that data on the movement of military equipment, personnel and complete trains could be siphoned and sent out of the country if the railways didn’t have complete control over the system.

The railways later also discovered that none of the company’s engineers and authorised personnel was available at the site for most of the time.

The company, moreover, did not create tie-ups with local agencies for physical work.

The company also did make any arrangement for procuring materials and it starts the project in earnest despite several meetings.

The project is funded by the World Bank and hence the railways cannot suo moto evict the company by ending the contract.

Railways wrote to the World bank and filed an official request for cancellation of the contract, which the World bank dragged its feet.

However, after the Galwan incident, the railways decided to terminate the contract without the World Bank’s permission.

And accordingly, the railways will now end the loan agreement.

It will further evict the Chinese company and an Indian player will be brought in for carrying out the project.


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