The Chinese engineering firm which was chucked out of a Rs 470-crore signaling contract recently has dragged Railways to court against the move even as India served it the formal termination letter on Friday.
The World Bank, which is funding the Eastern Dedicated Freight Corridor, has not given a no-objection certificate for the termination yet. Railways has decided to not wait for the World Bank and fund this portion of the project on its own.
“We have served the termination letter today. We would like this work to be done by some Indian player. We are drawing fresh specifications for a re-bid to that effect,” said Anurag Sachan, Managing Director of Dedicated Freight Corridor Corporation of India Limited (DFCCIL).
The Chinese company has approached the Delhi High Court to prevent the DFCCIL from encashing its bank guarantee. The matter was heard on Thursday.
“We will go by Indian standards and specifications for the work now,” Sachan said.
A subsidiary of Chinese major China Railway Signal and Communication Corporation (CRSC) bagged the contract for signaling works of over 400 km railway lines between New Bhaupur (Kanpur) and Mughalsarai (now Deen Dayal Upadhyay) section for Rs 470 crore.
As first reported in The Indian Express, the DFCCIL terminated the contract due to non-performance. However, the development was viewed in the light of prevailing tensions between India and China as it came at a time like this.
Beijing National Railway Research and Design Institute of Signal and Communication Group Co. Ltd, a solely-owned subsidiary of CRSC, bagged the contract in 2016. Since then, there has been just about 20 per cent progress in the work.
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