From AI chip to smart car… why is America reducing sugar in its cup?


New Delhi:
There is a competition between America and China to become the boss of the world. China has often been challenging America because of its ambitious policies. Be it the semiconductor sector, marine power or even space… America considers this competition of China as a threat to its national security. Therefore, it tries to slow down China’s progress by imposing many restrictions. In recent times, the American government has taken many such decisions, which are being linked to Russia and China. First, America tightened its laws regarding semiconductor chips used for Artificial Intelligence i.e. AI, so that Russia and China would face difficulties in acquiring AI chips. Now America has made new rules regarding smart cars. This was done to prevent Chinese technology from entering the American market.

America and China were once very good friends. China supported America in the first and second world wars. At present, America considers China as its biggest enemy. Let us understand why America, which once had good trade relations with China, started having problems with it? Why is America imposing sanctions on China one after the other…

Actually, Donald Trump is going to take oath as the new President of America on January 20. Before leaving, the Joe Biden government has decided to ban the software and hardware of Chinese vehicles in the American market in the name of America’s national security.

Trump had adopted a tough stance towards China
During the election campaign, Trump had promised to take a tough stance towards China. He had said, “We do not want to sell Chinese cars in America. If companies from China or other countries want to do business here, they will have to set up in America. Local people will have to be given jobs.”

America tightened rules on AI chips, then why did China get upset, understand

It was announced to bring such a policy in December
The US had announced in December that it was soon considering new restrictions in the car market to deal with the threats posed by drones using technology from adversaries like China and Russia.

US Commerce Secretary Gina Raimundo said, “We have serious concerns about security. It is extremely important to ensure that Chinese software and hardware do not become part of our connected vehicle systems. The purpose of the new rule is to prevent Chinese vehicles and Russian vehicles from being placed on American roads. “The presence of technology has to be limited.”

Gina Raimundo says, “Today, cars are not just vehicles running on wheels. They are computers in themselves. Modern vehicles are equipped with cameras. They have microphones installed in them. There is a GPS tracking system. Along with this, there are other technologies which are connected to the Internet.” The US Commerce Secretary says, “We have brought new rules to avoid the threats of the manufacturing technology of the People’s Republic of China and Russia.”

When will the rules come into force?
These new rules of America will be implemented from 2027. American restrictions on Chinese software will be effective after two years i.e. from 2027 and restrictions on Chinese hardware will be effective from 2030. America has talked about banning the hardware and software of China as well as Russia. America has also made these rules with the intention of boosting domestic industries.

The proposal was presented in September 2024
According to the report, America had proposed this rule in September 2024. After this feedback was taken from the industry. Under this, many vehicle manufacturing companies like General Motors, Toyota and Hyundai had demanded to extend the deadline of the rule. The US administration says that this step is necessary for national security. Therefore the deadline cannot be extended further.

This has never happened before in the 248 years of America’s history, Trump’s mega show at the swearing in.

Will Tesla benefit?
American electric car manufacturing company Tesla can benefit greatly from restrictions on Chinese software and hardware. At present, Tesla is number one in sales of electric cars. Whereas Tesla faces tough competition from China’s BYD. This Chinese company may suffer losses after America’s new sanctions. Whereas Tesla’s market share will become stronger. However, this decision of America may also affect the Indian market.

Rules for export of AI chips also made stricter
America has implemented new rules to give concessions in the export of AI chips to allied countries and to control its access to enemy countries like China and Russia. Current President Joe Biden has taken this big step before the end of his tenure. According to the new decision of the US government, there will be no ban on export of chips to 20 major American allies and partners including South Korea. At the same time, for countries like Russia and China, new rules have set limits on their computational power. China has been stunned by this step of America.

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How did the enmity between America and China increase?
The population of China in America is said to be above 40 lakhs. Between 1850 and 1905, there were many ups and downs in the relations between the two countries. There was growth in business, but sometimes there were losses too. But relationships remained. The trade war between the two countries started in July 2018. Then the then US President Donald Trump had imposed 25% tariff on 818 Chinese goods worth US $ 34 billion. China expressed strong objection to this. Then after many efforts, finally US President Donald Trump and Chinese President Xi Jinping held a meeting to resolve various trade issues including exchange rates, intellectual property rights. However, no result could be achieved from these meetings.

Now both these countries have been venting their anger on each other through other countries. For example, America takes the help of countries like Taiwan, Japan, India, Australia, Netherlands to target China. At the same time, China has been using countries like Maldives, Pakistan, Russia, Sri Lanka and Saudi.

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What problem does America have with China?
-America has been thinking that it is the world’s biggest economy, hence it will rule the world. Whereas Chinese President Xi Jinping’s ambition is to become the boss of the world. China believes that it has the market, the workforce… so it should move forward. Therefore, China is becoming self-reliant in the sector of AI chips also.

-On the other hand, America feels that if China gets AI chip, it will make the Dragon Army more powerful. China will also become strong in the technology sector. This is the reason why a new rule has been brought by America regarding this.

-America needs China’s economic competition, scientific competition, China’s increasing interference in the South China Sea, China’s stance on human rights, Jinping’s global ambitions, submarine power, increasing power of anti-ship ballistic missiles and rapid advances in space. Have trouble with. America wants to stop China from going ahead of itself at any cost.

-However, both the countries have been avoiding direct war. China and America are fighting the diplomatic battle by placing guns on the shoulders of other countries.

When did China get defeated by America?
-In 2016, America defeated China for the first time in the chip war. Then China was about to buy German company Extron. Some assets of this company were also in America. America’s Defense Department used to buy chips from this company. Then the then President Barack Obama banned this deal of the Sino-German company through an ordinance.

-Then this year America made a new rule regarding chips. The government made a rule that any American citizen, green card holder or company will take permission from the US government before providing help to a Chinese semiconductor company or making any deal.

-Then on August 9, 2022, the Joe Biden government passed the United States Chips and Science Act and tried to curb China’s flights to some extent.

-America, Japan and Netherlands made a deal regarding chips in January 2023. Under this, there was an agreement between these countries that these countries will not sell chip making technology, machines and services to China.

-ASML has emerged as America’s biggest weapon to defeat China in the chip war. This company manufactures lithography machines. That means printing the chip. But, after the agreement reached in America, Japan and Netherlands, ASML will no longer be able to sell lithography machines to Chinese chip manufacturing companies.

-America has imposed many types of economic sanctions on China, which include sanctions on Chinese banks and companies. America has imposed restrictions on Chinese companies and tariffs on Chinese products.

-America is now considering banning Chinese drones. An investigation was started in America in June last year, in which concern was expressed over the increasing presence of Chinese drones near sensitive American military installations. After which America had talked about banning Chinese drones.

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