SYDNEY - Australia's government will now pay for most of the cost of an internet cable connecting the Solomon Islands to Sydney after Australia's spy agencies raised security concerns posed by a plan for Chinese firm Huawei to build the link.

The Department of Foreign Affairs has confirmed it has taken responsibility for the undersea fibreoptic cable, including paying for the bulk of the project - which will cost tens of millions of dollars - through the overseas aid program, the Sydney Morning Herald reported on Friday (Jan 26).

The cable will provide a reliable internet link to the small Pacific island nation, which now relies on satellites.

The Solomon Islands under former prime minister Manasseh Sogavare signed up Huawei Marine to lay the cable connecting to Sydney. But Australia made it clear to Honiara that it had security concerns about the Chinese telco plugging into Australia's internet backbone, with Nick Warner, the head of spy agency ASIS, warning Mr Sogavare last June, the SMH said.

Huawei has previously been banned on the advice of security agency ASIO from being involved in the National Broadband Network.

Mr Sogavare was replaced as prime minister in November by Rick Hou, a former senior World Bank adviser who is well respected in Australia. Mr Hou had been highly critical of the circumstances in which Huawei Marine was awarded the contract under his predecessor.

A spokeswoman for the Department of Foreign Affairs told Fairfax Media the government has entered into a contract with the Australian telecommunications firm Vocus to carry out the initial work, the SMH said.

She said the Solomons project would be consolidated with a project to lay a new cable connecting Papua New Guinea with Australia, creating "significant efficiencies on cost". The cost of the Solomons project alone has previously been estimated at A$86 million (S$91 million).

The SMH said Australia was concerned about the security implications of Huawei being involved in connecting to Australia's critical infrastructure, but also more broadly about a Chinese firm - even a private sector one - extending Chinese influence into the Pacific through the cable project.

The SMH quoted a Huawei spokesman as saying: "We've been advised by the Solomon Islands Submarine Cable Company that Vocus has been contracted to undertake a scoping study but that's all they have said to us."

Jonathan Pryke, a Pacific islands expert at the Lowy Institute, applauded Australia's move, saying that it made strategic and security sense while also providing much-needed development.

"There's clearly a strategic objective to this project. It's to make sure there's no opportunity for third players like China or a Chinese company like Huawei to swoop in and provide a cable to PNG or the Solomons that could affect strategic interests and compromise Australia's security," he told the SMH.