The contract envisages setting up 8 lakh code division multiple access (CDMA) based wireless in local loop telephone lines in Delhi and Mumbai.
Huawei had jointly bid with Himachal Futuristic Communication Ltd for the WLL-based mobility services project.
Another Chinese manufacturer ZTE Ltd has emerged as the second lowest bidder. Other vendors which had tendered bids included global giants Motorola, Ericsson and Nortel.
Motorola had earlier serviced MTNL by putting in place nearly 1 lakh WLL lines in Delhi. MTNL is evaluating the bids and is expected to award the contract in the next couple of weeks.
HFCL officials said the company had a number of manufacturing facilities and had installed 1.5 lakh lines in Punjab itself apart from the expertise that Huawei brought on the table from handling similar projects in China.