The Indian government is blocking purchases of telecoms equipment from Chinese vendors on national security grounds, ratcheting up trade tensions between Asia’s fastest-growing large economies.

The practice has prompted complaints from Beijing and is causing havoc for mobile operators in India, which need enormous amounts of equipment to sustain an industry that is adding 20m new users a month.

To read this report from The Financial Times in full, see:
www.ft.com/cms/s/0/6e5f923a-53b8-11df-aba0-00144feab49a.html

Also see:

India Imposes Partial Ban on Chinese Telecom Equipment
The Indian government is banning the purchase of some Chinese-made telecommunications equipment, one of the largest private mobile operators in India said Friday. This week, the government told the mobile operator that it could not go through with the planned purchase of equipment from UT Starcom, a company that is headquartered in California but has most of its employees and managers in China. The government said some orders were “good to go, and these were not” said an executive from the Indian company, who did not want to be identified because the government has not made this policy official.
www.nytimes.com/2010/05/01/business/global/01delhi.html