ZTE, a leading global provider of telecommunications equipment and network solutions, may walk away with Rs.4000 crore BSNL contract to expand existing 2G network and improve services in the north, east and south zones, Economic Times reports.

BSNL had floated tender for the expansion in July 2011 under phase seven of expansion. Telecom equipment major and Ericsson, Huawei and Nokia Siemens Network, and Alcatel Lucent had also participated in the bid. 

The expansion of network includes planning, financing, engineering, supply, installation, testing, commissioning and annual maintenance. Last month ZTE, Huawei and Alcatel-Lucent were selected by state owned telco BSNL for 14.37million Global System for Mobile (GSM) communication lines.  

According to report, Huawei, Alcatel Lucent, Ericsson and Nokia Siemens Networks have declined to match the lowest price of $50 per line quoted by ZTE, said three people familiar with the development. 

While ZTE had emerged as the lowest bidder by quoting a price of $50 a line, Huawei had bid the second lowest. According to the terms and conditions of the BSNL tender, Huawei would have to match ZTE's price to win the contract in the eastern zone. But a senior executive at Huawei said the company would walk away from this deal because it would be 'technically unviable' to operate at the price. "It's not just us, everyone else who had bid higher than ZTE would also refuse because it's unviable for all," the executive told ET, choosing to stay anonymous.