AI chip maker Nvidia and AMD have agreed to give 15 percent of the profit from the semeconductor chip in China to the US government. According to a BBC report, the agreement is a part of obtaining export license for the world’s second largest economy.

NVIDIA told BBC, we follow the rules made by the US government for our participation in markets around the world. We have not sent our H20 chip to China for months. We hope that the rules made to control exports will help America to keep competitive by China and worldwide. AMD has not said anything on this at the moment.

Export control implemented in Biden’s government

Let us know that in October 2022, the US implemented export control in the administration of Biden. Its purpose was to prevent the access of advanced chip in China to prevent China’s ever -increasing steps towards technology.

The US feared that on these AI chips, China would strengthen the Artificial Intelligence System and also move forward in military technology as AI chips are also used to operate autonomous weapons systems. In such a situation, if the Chinese army becomes strong, then it will create a big challenge for America. Due to this, the US banned the sale of GPU chips like NVIDIA’s H100 and A100 in China.

The company is suffering loss of billions

Due to this ban of America, the company faced an estimated huge loss of $ 5.5 billion at the beginning of the year. The company is also being described as a danger of loss of $ 8 billion in the July quarter. According to sources, NVIDIA CEO Jenson Huang met US President Donald Trump on Wednesday in this connection. In July, China was also informed by the company to apply a license to resume the H20 shipment in July.

Made on this condition

Now, under the deal with the US government, the company will give 15 percent of its revenue to the US government from the sale of H20 chips in China. At the same time, AMD will also give such a part of the revenue from its Mi308 chip. This information has been given in the report of Financial Times.

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Jensen huang: There was a time when in Trump’s first term, Apple’s CEO Tim Cook was considered the mastermind of business relations between the US and China. He formed a strong relationship with the Trump administration and did not distance from Beijing. As a result, Apple was saved from American tax and continuously developing in China. But in Trump’s second term, the situation has changed. Now Apple’s crown is the head of Nvidia and its CEO Jenson Huang is being seen today as America’s most influential tech leader. The success of Nvidia in the world of AI has made Huang not just a businessman but a global political face.

AI’s strength and Huang’s rise

The Wedbush Analyst Dan Iaves says, “The role of Nvidia’s chips in the AI revolution has brought Huang ahead of Tim Cook.” He believes that today the major chip that gives strength to AI in the whole world is only of NVIDIA. Recently Huang visited Beijing, where he announced to resume the sale of NVIDIA H20 AI chip.

These chips were banned on sale to China earlier this year, but Huang openly opposed it and lobbied against it. Their efforts brought color and now America has relaxed this decision.

Politics rises in politics

It is clear from this historic victory that Huang’s impact on Trump administration is increasing. He had met Trump at Washington DC before leaving for China. Their effect as a result of his ban on the H20 chip was softened. According to experts, Huang explained to the US administration that prohibiting the chip could weaken America’s technical growth and would benefit Chinese companies.

NVIDIA has also recently dealt with hundreds of thousand AI chips to UAE in which Huang played an important role with Trump. The deal strengthens the global tech leadership of America, especially compared to companies like Huawei of China.

Tim Cook and Musk followed

Earlier it was believed that in Trump’s second term, Alan Musk would be the closest tech leader of the administration but his relationship with Trump is no longer sweet. At the same time, Tim Cook is now facing criticism of the administration, especially when Apple starts construction units in India.

Trump administration advisor Peter Navaro recently criticized Cook, saying that he is very slow in removing manufacturing from China. Cook and Apple, once considered the most influential, are now looking back in the political field.

Future uncertainty remains intact

Although Huang’s influence is currently at the top, experts believe it is not permanent. According to Paul Tricolol of DGA-Alberite Stonbridge Group, the policy of Trump administration has been continuously changing, which requires huge losses and re-designs to companies.

Apart from this, the US is currently investigating the semicondia sector, so that NVIDIA can once again be targeted by the policies of the Trump government. Even though Nvidia is doing some construction in America, but a large part of it is still in Taiwan.

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