Australia's top spy has warned the Solomon Islands that a planned 4000 kilometre-long internet cable connecting the tiny Pacific nation to Sydney could be torpedoed after it signed up controversial Chinese firm Huawei to lay the cable, Fairfax Media understands.

The future of the communications cable project is now uncertain because of Australia's fears about the involvement of Huawei, the communications giant that was banned from working on the National Broadband Network on the advice of security agency ASIO.

Nick Warner, the head of the foreign intelligence agency the Australian Secret Intelligence Service, is understood to have warned Solomons Prime Minister Manasseh Sogavare of Australia's concern during a visit to capital Honiara last month to mark the end of the Australian military and police assistance mission to the country.

Fairfax Media understands that while Australia strongly supports the cable project because of the economic benefits it would bring to the struggling island nation, it has become concerned since the Solomons government abruptly abandoned previous plans to sign up a US-British firm to lay the cable and instead began pursuing an opaque deal with Huawei in mid-2016. The switch by Honiara also prompted the Asian Development Bank – which would have provided concessional financing – to withdraw support because of the lack of transparency, it is understood.