"The meaning of making a safe and controllable IT environment is to better protect national security rather than ousting foreign firms," said Zuo, who co-authored the first security standard for cloud-computing industry.

Gene Cao, a senior analyst at Forrester Research Inc, said that being controllable does not necessarily exclude overseas vendors from government procurement.

"An example is recent media reports stating Apple Inc CEO Tim Cook's willingness to accept security checks. If Apple's products pass the checks, they will be eligible for government procurements," Cao said.

IBM denies reports of huge job cuts

IBM Corp on Monday denied media reports that it will cut 110,000 jobs, saying the layoff only involves several thousands employees.

In a response to a Forbes report that IBM would downsize staff by 26 percent, the company refuted it as "groundless" and said it will invest $600 million on corporate restructuring, with the number of employees involved being several thousands.

After a disappointing third-quarter earnings report, the company said it decided to initiate job cuts in some areas, even as it created more than 10,000 new jobs across the world.

Most of the jobs are in cloud computing, data mining, cybersecurity and mobile technology where IBM is seeing quick growth, the company said.

It remains unclear how the layoff will affect the company's China operations. The company is yet to disclose detailed plans of the job cuts.

Robert LeBlanc, senior vice-president of IBM, said this week the company is planning to recruit 1,000 cloud-computing experts.

The latest round of job losses comes as the company grapples with declining revenues. Data show its third-quarter revenues plummeted to $24 billion, down 11.9 percent from a year earlier.