India blocks Huawei's plan to invest in ITI

Published: 25 Jun 2009 17:23:00 PST

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Jun. 26, 2009 (China Knowledge) - The Indian government said it would not grant approval to China's Huawei Technologies Co Ltd to buy into three units of state-owned Indian Telephone Industries Ltd (ITI), the Economic Times reported on Wednesday.

An anonymous official from the local government in India said that Huawei's proposed investment plan would require India to allow the company an unacceptable level of security clearance, according to the report.

The Indian government banned all Chinese companies from bidding, but Huawei is the only Chinese company that has expressed interest in the three loss-making plants in Bangalore, Rae Bareli and Naintal.

Previous reports said that Alcatel-Lucent Holding Inc, one of the world's leading providers of telecom solutions, is also among the potential bidders, but bidding plans have not been confirmed yet.

Huawei's net profit grew 20% to US$1.15 billion in 2008 from US$956.9 million a year earlier. The company this year aims to maintain steady growth and to obtain US$30 billion worth of contracts as compared to US$ 23 billion in 2008.

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