New York: A $ 15.2 million contract between a subsidiary of India-based Tata Consultancy Services and an American State agency has been cancelled, falling victim to politics in view of elections in the United States next year.

Indiana State's Governor Joe Kernan, a Democratic candidate for elections due in November next year, has ordered the State Department of Workforce to cancel its contract with Tata America International Corp, a subsidiary of Tata Consultancy Services (TCS), to upgrade state computers processing unemployment claims.

Kernan said yesterday (November 21) that the agency's request for competitive proposals had been put together and advertised in a way that "virtually knocked Indiana companies out of the running", 'Indianapolis Star' reported.

A spokeswoman for TCS was quoted as saying that "this is a decision for the State of Indiana to make, and TCS will comply."

No Indiana firms had submitted bids for the contract, the Star said. "That is not the way I choose to do business," it quoted Kernan as saying.

Top aides to then Governor Frank O'Bannon had signed off on the politically sensitive, four-year contract before his death on September 13. State officials got a number of letters and phone calls complaining about the contract after the Star wrote about it on September 29.

PTI