China This Week | China-Pak-Afghanistan meeting in Beijing, NVIDIA CEO says US policy on tech to China ‘failed’

During Pakistan Foreign Minister Ishaq Dar’s three-day visit to China this week, both sides invoked their “brotherly” and “ironclad” relationship.

The Chinese government released a white paper on national security earlier this month – meant to act both as a report card of where the country stands and as a projection of its rhetoric to the world.

As the AI race between the US and China continues to intensify, Jensen Huang, CEO of the world’s largest semiconductor company, Nvidia, has weighed in – saying the American efforts to squeeze China’s access to cutting edge chips that are needed for advanced AI ended up making Chinese tech companies stronger.

Here is a closer look at these developments:

1. Pak’s Dar in China, announces CPEC extension to Afghanistan

Dar visited China from May 19 to 21. Wang Yi, his Chinese counterpart, said “China welcomes and supports Pakistan and India in properly handling their differences through dialogue, achieve a comprehensive and lasting ceasefire and seek fundamental solutions.”

He repeated that “China will, as always, firmly support Pakistan in safeguarding its national sovereignty and territorial integrity.”

Wang also called for an “upgraded version of the China-Pakistan Economic Corridor”, the infrastructure project under China’s Belt and Road Initiative (BRI).

Importantly, Wang and Dar met informally with Afghan Acting Foreign Minister Amir Khan Muttaqi in Beijing, where Afghanistan and Pakistan expressed willingness to “elevate bilateral diplomatic relations”, which have suffered in recent years.

The two sides agreed “in principle to exchange ambassadors expeditiously”. They said the CPEC, which extends from China’s Xinjiang region to Pakistan’s Gwadar port, would be expanded to Afghanistan.

Wang said China respected Afghan independence, sovereignty, and territorial integrity, as well as the independent choices, religious beliefs and ethnic culture of the Afghan people – and supported their just struggle against foreign aggression”.

UPSHOT: A reiteration of support from China, its biggest benefactor, at a time of tensions with India, matters for Pakistan. The two countries have deepened their strategic relationship over the decades to the end of curtailing India’s regional influence.

Getting Afghanistan in the mix, however, complicates the situation, given the fraught bilateral relations between Islamabad and Kabul under the Taliban. Pakistan has carried out air strikes against alleged militants on Afghan soil, and pushed back tens of thousands of Afghan refugees.

China was among the first countries to exchange ambassadors with Afghanistan under the Taliban, even though it withheld full recognition. India, which does not recognise the Taliban, has also reached out to the Afghan government in the last few months. Foreign Secretary Misri spoke to Muttaqi in January this year.

Meanwhile, CPEC has been struggling, with Baloch militant attacks hampering construction efforts. The financial returns on these massive investments remain questionable.

2. New pivot in national security white paper

The State Council Information Office, the top information office of the Chinese government, released a white paper, ‘China’s National Security in the New Era’, this month.

The document covers multiple topics under the umbrella of national security, ranging from AI to climate change, alongside Taiwan and Hong Kong. It refers to the expansive Overall National Security Concept (ONSC), introduced in 2014 under President Xi Jinping. There is also a focus on balancing development and security.

The paper only makes one reference to India, in the context of China’s border security and interests. “China has negotiated with 12 of its 14 land neighbours to resolve land border issues, and border negotiations with India and Bhutan continue to advance,” it says.

UPSHOT: Security and stability have long been emphasised by the Chinese state with regard to the longevity of both the nation and the Communist Party. Anushka Saxena, a researcher at the Bengaluru-based think tank Takshashila Institute who focuses on the People’s Liberation Army, told The Indian Express the paper implied a “pan securitisation of everything”.

“High-level security is going to be the pillar on which development and growth are harnessed, and it is also described as a new ‘red line’ in the white paper.

“So, it’s indirectly telling the US that open growth and economic development is a national security issue for us (China) now, and if you are going to stop that, say, through tariffs or other restrictions, it is going to be treated as a red line, just like Taiwan is a red line,” Saxena said.

But at another level, it shows China’s anxiety, she said, pointing in particular to a line that says: “Some key core technologies are still controlled by others, the foundation for economic recovery is not yet solid… affect(ing) social security and stability…”

3. NVIDIA chief’s comments on US chip policy

China on Monday asked the US to “immediately correct its wrongdoings” after the latter warned companies not to use advanced computer chips from China. These chips are crucial for training AI models (such as OpenAI’s ChatGPT and Google’s Gemini).

Two days later, Nvidia CEO Jensen Huang said in Taipei, Taiwan, that the US policy of putting export controls on AI chips to China had been “a failure”. He said they had contributed to reducing Nvidia’s China market share from 95% to 50% over the last four years, and motivated China to hasten the production of its own chips.

The Chinese company Huawei, he said, was “incredible in computing and network technology, all these essential capabilities to advance AI”. “They have made enormous progress in the last several years.”

Over the last few years, the US has instituted several restrictions on the sale of AI chips to China. The AI Diffusion Rule that former President Joe Biden signed in January – but was rescinded by the Trump administration – focused on the “most advanced” AI models and “advanced computing integrated circuits (ICs) to protect US national security and foreign policy interests”.

Countries were classified into three tiers: total access, limited access and effective ban. While India was in the middle category, China and Russia had no access.

UPSHOT: The release of Chinese AI company DeepSeek’s models in January shattered several assumptions about the state of the AI race. The company was able to build quality models at a fraction of the cost of American companies, using comparatively inexpensive chips. Soon after its launch, Nvidia’s stock plummeted.

Chinese technology, and companies such as Huawei, have long faced restrictions from the US. China, too, has imposed blockades such as export controls on critical minerals gallium and germanium (used in chipmaking) to the US.

Huawei has posted high growth figures with its new smartphones and chips, driven by domestic demand. This is what Huang was likely referring to when he said the original assumption behind the diffusion rules – that China would lose the tech race if it was cut off from American advanced tech – has turned out to be incorrect.