"There is a need to bar companies from China and Pakistan from bidding for contracts in India," he said.
Eligibility criteria for inviting tenders should be devised in such a way that Chinese companies are rendered ineligible to bid for contracts, the former BJP general secretary said.
Many a time there are conditions in a contract which facilitate the entry of Chinese firms, he said.
Govindacharya was replying to a question about a Chinese company getting the contract to supply coaches to Nagpur Metro Rail.
The campaign 'Say no to China - Be Bhartiya buy Bhartiya' was launched by the Rashtriya Swabhiman Andolan, an organisation founded by Govindacharya. The campaign will run in more than 50 cities till September 6, and conclude in New Delhi.
Govindacharya's comments come at a time when India and China are locked in a border stand-off in the Sikkim sector.
He said India should negotiate bilateral trade pacts instead of taking the multilateral route.
Another solution is to bring a law to build Ram Mandir in Ayodhya, he added.
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