By C.J. Kuncheria and Matthias Williams NEW DELHI, May 10 (Reuters) - Indian Prime Minister Manmohan Singh censured a high profile minister for comments made in Beijing criticising the government's "paranoid" attitude towards Chinese companies and investments, officials said on Monday. The spat within India's ruling Congress party comes at a sensitive time with persistent media reports India has banned imports of telecom equipment into its booming market from its giant Asian neighbour because of security fears. Government officials deny any country-specific ban has been imposed but say there are "security restrictions" in place which need to be addressed to import sensitive goods. Chinese network gear makers Huawei Technologies and ZTE Corp are active in the Indian market and have given global rivals tough competition in the world's fastest growing telecoms market. Ties between India and China have warmed recently in the backdrop of a trade boom and close cooperation on climate change since the Copenhagen world climate talks in December, after a difficult year that saw them clash over a raft of issues including their long-disputed border. "At some stage, if we become paranoid about Chinese investments in India, as we seem to be, then we are not going to be able to derive the full benefits of the Copenhagen spirit," Indian Environment Minister Jairam Ramesh was quoted by Times of India newspaper as saying in Beijing, where he was on a visit. Prime Minister Manmohan Singh has "clarified it is not appropriate that ministers comment on other departments, ministries, or subjects, especially and particularly when they are on foreign soil," Congress party spokesman Abhishek Manu Singhvi told reporters. Despite a boom in bilateral commerce in the past decade, India and China remain suspicious of each other's growing global clout and have in the past traded charges of protectionism. India has long pushed for greater access to the Chinese market to help close a chunky trade deficit in Beijing's favour. "We have a huge trade deficit with China. But we are still suspicious of Chinese investment in India," the Press Trust of India quoted Ramesh as saying in Beijing. Shenzhen-based Huawei, which last fiscal year more than doubled its India revenue to $1.4 billion, has sought to meet Indian officials to allay these concerns, which could see it lose business to firms like Ericsson, Nokia Siemens Networks and Alcatel Lucent. "While we encourage trade, we are also mindful of some of the needs of the security establishment," Indian Trade Minister Anand Sharma told reporters on Monday, denying there was a China-specific ban. In an interview with Reuters last week, U.K. Bansal, India's internal security chief, said telecoms equipment from any country could be a security concern and would require proper scrutiny. "Telecom anywhere, all over the country, its security and its reliability and its vitality is always a matter of concern," he said. Ramesh's comments sparked the latest in a series of recent spats in which Congress party officials or ministers spoke out against a government stance. Last month, Digvijay Singh, a general secretary seen close to Congress-scion Rahul Gandhi, criticised Home Minister Palaniappan Chidambaram's strategy against the Maoist insurgency and said he had been a victim of the minister's "intellectual arrogance." (Additional reporting by Bappa Majumdar and Paul de Bendern; Editing by Jerry Norton) ((firstname.lastname@example.org; Reuters Messaging: email@example.com, +91-997-111-0254)) Keywords: INDIA CHINA/ (If you have a query or comment on this story, send an email to firstname.lastname@example.org) COPYRIGHT Copyright Thomson Reuters 2010. All rights reserved.
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