LAC row: REC arm cancels contract to Chinese firm

New Delhi, July 30: Stateowned REC Power Distribution Corp Ltd (RECPDCL) on Thursday said it removed a Chinese firm from the smart meter project in Jammu and Kashmir soon after the government order on sourcing of equipment from 'prior reference' nations.

RECPDCL, an arm of Rural Electrification Corp (REC), had in September 2019 awarded a project for installation of 1.155 lakh smart meters in Jammu & Kashmir to Techno Electric & Engineering Co Ltd.

In a statement, RECPDCL said the project was awarded to an Indian company, Techno Electric & Engineering Co Ltd. The company engaged subcontractors for different components of the project.

After the power ministry issued an order mandating prior permission of the government for any import of equipment from 'prior reference' countries or nations with which India shares borders, to check for possible cyberattacks through malware/trojans, the company reviewed all new/ongoing contracts.

“After this order was issued, all new/ongoing contracts are being reviewed and as part of that review one of the sub-contractors of the (J&K) project, which though a company registered in India and having manufacturing facilities in India, was found to be a subsidiary of a Chinese company.

“The said sub-contractor was directed to be removed from the project since the continuation of the subcontractor would have led to the requirements of taking prior permission and testing of every equipment supplied thus leading to unacceptable delays in execution,” it said. The principal contractor has informed RECPDCL that they have removed that sub-contractor, the statement said.