Mexico has scrapped the $3.75bn contract with Chinese-led consortium for the construction of a high-speed passenger rail link between Mexico City and the central city of Queretaro.

The move comes after the government was accused of favouring the group consisting of China Railway Construction Corporation and CSR Corporation. It was the only firm that submitted the bid for the tender to design, build, operate and maintain a 210km-long high-speed line.

Other bidders, including Siemens, Bombardier and Alstom, had requested for extension of the tender period.

"The project is expected to carry 27,000 daily passengers from Queretaro to Mexico City at a maximum speed of 300km/h (186mph)."

However, the government did not consider their requests and awarded the contract to the Chinese consortium that submitted the bid before the deadline.

Mexico’s Communications and Transport Ministry said that it will launch a new auction in late November under the same terms, and would keep it open for six months to enable all interested parties to participate.

However, the contract value will change by the time of contract is signed, depending on the inflation, exchange rates and other variables.

The Export-Import Bank of China (EximBank) is expected to finance 85% of the project’s costs.

The project is expected to carry 27,000 daily passengers from Queretaro to Mexico City at a maximum speed of 300km/h (186mph).

According to estimates, the project will produce 20,000 direct jobs and take 18,000 passenger cars off the road.

The government also has plans for two other projects, including the construction of a line linking Mexico City with Toluca, as well as a rail track to Yucatan.