MCI Communications Corp. is installing a $1.6 million Japanese fiber-optic system in New York to provide more and faster connections among its four principal telephone toll centers.

Fujitsu Ltd., a major Japanese computer company, will supply the electronics for the 10-kilometer system, which is expected to be operational by August, according to MCI Chairman William G. McGowan.

Last year, Fujitsu had submitted the lowest bid to build an even larger system for American Telephone & Telegraph Co. But after Congress pressured AT&T to buy its system from an American company, AT&T awarded its contract to its manufacturing arm, Western Electric.

McGowan said he chose Fujitsu because it offered far better service than AT&T's local operating company, New York Telephone Co., promising, among other things, faster installation.

Half of the $1.6 million contract, McGowan added, will be going to a subsidiary of Corning Glass Works which will be making the fiber optics.

McGowan said the fiber optics will enable the long-distance company to transfer calls between its toll centers for load balancing in a far more efficient and speedier manner.

Fiber-optic systems transmit voices and data with pulses of light. Although they are lighter and far smaller than the copper wire, the glass wires can handle hundreds of more calls at a time.