China bans foreign AI chips; Nvidia turns to India with new startup alliance

In a significant shift, the Chinese government has mandated that new state-funded data center projects must exclusively utilize domestic artificial intelligence chips. This move, reported by Reuters, affects foreign semiconductor options currently deployed in China, including Nvidia's H20, B200, and H200 models. Authorities have directed data centers that are under 30% completion to eliminate all foreign chips, or forfeit their plans to acquire them. For more established projects, decisions regarding the removal of foreign-made chips will be evaluated individually. This new directive is poised to stifle Nvidia's ambitions in the Chinese market, where its market share has plummeted from a commanding 95% in 2022 to zero, according to recent data. The U.S. has taken a hands-off approach, with President Trump recently stating that the U.S. will allow China to 'deal with Nvidia,' particularly concerning advanced chip technologies. In response to these challenges, Nvidia has turned its gaze towards India, announcing its participation in the ‘India Deep Tech Alliance.’ This coalition, formed by both Indian and U.S. investors, aims to support deep tech startups across South Asia, as reported on November 5, 2025. Nvidia, under the leadership of billionaire Jensen Huang, has secured over $850 million in capital commitments as new investors join the alliance, including Qualcomm Ventures and InfoEdge Ventures. Launched in September 2025 with an initial commitment of $1 billion, the alliance focuses on sectors such as semiconductors, space, AI, and robotics. As part of this initiative, Nvidia plans to offer technical guidance and training to startups, facilitating their access to advanced AI and computing tools. This strategic pivot comes on the heels of the Indian government’s introduction of a $12 billion program aimed at bolstering research and development in the country. Moreover, deep-tech startup funding in India surged by 78% last year, reaching $1.6 billion, according to industry body Nasscom, highlighting the growing potential of this sector.