MEXICO CITY: Mexico has revoked a contract for a $3.75 billion high-speed passenger rail link from a Chinese-led consortium after its uncontested bid prompted an outcry from lawmakers, souring a state visit to China by President Enrique Pena Nieto.

After the contract was awarded recently, opposition politicians accused the government of favoring the group led by China Railway Construction Corp. Ltd, the sole bidder.

Mexico’s communications and transport ministry said late on Thursday it would now hold a new auction for the job.

“The president is sensitive to the fact that there should be no doubts about a project this important and of such benefit for society,” the ministry said in its statement.

Since Pena Nieto took office in late 2012, he has tried to forge closer ties with China after years of manufacturing rivalry between two nations seeking to supply the US market.

Announcing the contract on Monday, Mexico’s government said the 210-km line to connect Mexico City and the central city of Queretaro would cost 50.82 billion pesos ($3.74 billion), including the build cost and five years of operation.

The proposal came with a 20-year, Chinese government-backed credit to cover most of the project’s value, at interest rates below those available even to Mexico’s government.

News of the cancelation helped to drag down Chinese stocks on Friday and is an embarrassment for Pena Nieto ahead of his Chinese trip.