Schumer asks government to probe rail tech from China

[May 20, 2019]  By Nandita Bose

WASHINGTON (Reuters) - U.S. Senate Democratic leader Chuck Schumer is asking the federal government to investigate if a plan for new subway cars in New York City, designed by a Chinese state-owned firm, could pose a threat to national security.

The move comes after China's CRRC Corp Ltd <, the world's top passenger train maker, was slammed by U.S. lawmakers during a hearing on Thursday to limit its access to U.S. projects amid security fears.

It also comes at a time when the Trump administration has added China's Huawei Technologies Co Ltd to a trade blacklist, citing security risks as the world's two largest economies ratchet up tariffs in a battle over what U.S. officials call China's unfair trade practices.

CRRC, The Chinese state-owned company, which won a design contest for new subway cars, plans to install new technology in the New York subway system and government agencies must determine whether this poses any threat to the Metropolitan Transportation Authority and its commuters, Schumer said in a statement to Reuters.

"Given what we know about how cyberwarfare works, and recent attacks that have hit transportation and infrastructure hubs across the country, the Department of Commerce must... thoroughly check any proposals or work China's CRRC does on behalf of the New York subway system, including our signals, Wi-Fi and more," Schumer added.

Senate Minority Leader Chuck Schumer speaks with reporters following the weekly policy luncheons on Capitol Hill in Washington, U.S., May 7, 2019. REUTERS/Aaron P. Bernstein

The company has not won a contract in New York City, which has America's biggest transit system. However, it has won contracts for new subway cars in Los Angeles, Chicago, Boston and Philadelphia.

CRRC has also launched a charm campaign in the United States as it seeks to secure a Washington D.C. metro car contract worth over $500 million, after roaring into the American passenger rail market by dramatically underbidding foreign rivals.

Concerns CRRC could soon set its sights on the much more lucrative U.S. freight market and use its railcars to spy on passengers have prompted a series of legislative proposals.

A bipartisan bill unveiled in the U.S. House recently, which mirrors one proposed in the Senate earlier this year, would prevent transit agencies from spending federal dollars on projects awarded to CRRC.

(Reporting by Nandita Bose; Editing by Sandra Maler)

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