CHINA: China’s artificial intelligence (AI) sector is experiencing a surge in investment, largely driven by the rise of DeepSeek, a homegrown AI startup. However, this rapid growth has also placed the company at the centre of geopolitical tensions. Several nations have moved to restrict DeepSeek’s operations, citing security concerns, a move that has drawn sharp criticism from Beijing.
DeepSeek’s rise amidst growing international scrutiny
DeepSeek, a Hangzhou-based AI company, has made headlines with its cost-effective large language model, challenging Western-developed AI systems. According to Digital Watch (DW), the company’s breakthrough has not only strengthened China’s AI capabilities but has also driven a significant increase in investor enthusiasm. As a result, stocks of AI, semiconductor, and robotics firms in China and Hong Kong have surged, with the Hang Seng AI Index rising over 5% and AI-related firms gaining more than 11%.
However, DeepSeek’s success has also triggered international concerns. As reported by CGTN, multiple countries have recently imposed restrictions on the company, citing fears over data security and competitive imbalances. The move mirrors previous curbs on Chinese tech giants such as Huawei and TikTok, reflecting a broader effort by Western nations to limit China’s technological influence.
China condemns “Politicisation of Technology”
Beijing has strongly criticised these restrictions, accusing foreign governments of politicising technological advancements. According to CGTN, Chinese officials have argued that such measures are not about security but rather an attempt to curb China’s technological progress. The government has called for an open and fair global technology ecosystem, urging nations imposing restrictions to reconsider their stance.
In response to the mounting international scrutiny, China has doubled down on its efforts to bolster domestic AI research and reduce reliance on Western technology. The government’s stance has resonated with local investors, who have viewed the restrictions as a signal to accelerate support for homegrown AI startups like DeepSeek.
The future of AI in China: Nationalistic investment surge
While DeepSeek faces growing external challenges, its position within China has only strengthened. The company has become a symbol of China’s technological ambitions, attracting significant domestic investment. As DW reports, analysts predict that the AI industry in China will see substantial expansion by 2025, with key players such as Nancal Technology and Suzhou MedicalSystem Technology emerging as major beneficiaries of the AI boom.
DeepSeek’s journey underscores the increasing intersection of technology, economics, and geopolitics. As China continues its push for AI leadership, its ability to navigate global restrictions and foster innovation at home will shape the future of artificial intelligence both within its borders and beyond.