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China Bans Foreign AI Chips in Government Projects; Nvidia Shifts Focus to India’s Deep-Tech Ecosystem
China has banned the use of foreign AI chips in new data centers. This move has dealt a major blow to American tech company Nvidia, after which the company is now making a fresh start in India through the 'India Deep Tech Alliance'.
In a major decision, China has banned the use of foreign artificial intelligence (AI) chips in all new government-funded data center projects. According to a Reuters report, the Chinese government has directed that data center projects less than 30% complete remove or cancel purchases of foreign chips.
This ban has dealt a major blow to American chip companies like Nvidia, whose chips, such as the H20, B200, and H200, were very popular in China. Nvidia had a 95% share of the Chinese market by 2022, but that has now virtually disappeared. Nvidia CEO Jensen Huang recently stated in an interview with Citadel Securities that he is now completely exiting the Chinese market, reducing his business to zero percent.
According to the report, this move will strengthen China's domestic semiconductor companies, but it could further widen the gap in AI computing capabilities between the US and China. Former US President Donald Trump also recently stated that the US would allow China to deal with Nvidia, but not for "the most advanced chips."
