The company says it will lodge an official complaint
A leading Chinese software company based in India has angrily denied allegations that it supplied telecommunications and surveillance equipment to the Taleban regime in Afghanistan.
Reports from the southern Indian city of Bangalore - where the firm is based - say the state government has summoned company officials to clarify the situation.
Officials from Huawei Technologies have said they will complain to the Indian Ministry of External Affairs about allegations published in the press.
The row threatens to jeopardise the growing co-operation between India and China in developing computer technology.
Deportation warning
Huawei Technologies operates one of the largest software development centres in Asia, specialising in telecommunications.
The company employs more than 400 Chinese and Indian technicians in Bangalore.
It issued its statement after the widely respected Economic Times newspaper reported on Monday that a cabinet committee headed by Home Minister L K Advani may take the unprecedented step of deporting over 150 Chinese telecom experts from the city.
The newspaper said that the company involved - which it did not name - had been developing telephone surveillance equipment for the Taleban.
Passport details
The Hindustan Times said that Huawei Technologies is also suspected by the government of helping Iraq acquire military communications systems.
The newspaper says defence officials are concerned that its headquarters are near key defence installations in Bangalore.
Officials in the city have meanwhile confirmed that they have collected passport details of all the Chinese staff who work for the company and have passed them on to the home ministry in Delhi.
The fear now is that this row will interrupt India's efforts to hire more Chinese technicians.
It sees them as cost-effective and capable of providing in-roads to the lucrative software market in China.