Trump admin to allow resumption of H20 AI chip sales to China: Nvidia

Nvidia on Tuesday announced that the US government has assured it of being granted licences to resume the sale of its H20 graphics processing units (GPUs) to clients in China, the company said in a statement.

 

Sharing an update with its customers, Nvidia's Chief Executive Officer (CEO) Jensen Huang said that the company has started filling out applications to sell the NVIDIA H20 GPU again, adding that the company hopes to resume the deliveries soon. 

 

This comes after the sale of its H20 chips was halted in April and were designed specifically to bypass the US export controls targeting China. 

 

 

The story so far

 

Earlier in April, it was reported that the US President Donald Trump's administration imposed restrictions on the sale of Nvidia's H20 chips to China, tightening its control over the trade of advanced artificial intelligence technology with Beijing as part of its strategy to put pressure on China amid the tariff dispute. 

 

On April 9, Nvidia was informed that exporting the H20 chips to China would require government permission, adding that the restriction was in effect indefinitely. The restrictions were imposed citing national security concerns. 

 

The H20 chip gained attention after it was used by DeepSeek, a Chinese AI startup that debuted a cost-effective and competitive AI model trained with the chip in January.

 

The H20 chips are Nvidia's most advanced artificial intelligence chip that was previously available in China and became a crucial part in its booming artificial intelligence sector.  The H20 chip was created to push performance limits without breaching the US export controls, which were first introduced during Joe Biden's term, a Financial Express report stated. 

 

Several Chinese tech giants, including Alibaba, Tencent, and Bytedance, were among the ones who were reportedly increasing the H20 purchases to meet the increasing demand for cost-effective artificial intelligence models. A report from RFA in April claimed that the leading Chinese tech firms, including Alibaba, Tencent, and ByteDance, collectively ordered over $16 billion worth of H20 chips in the first quarter, marking a rise of more than 40 per cent from the previous quarter.

 

Ever since Trump came back to office for the second term, his administration indicated that it would deepen the tech restrictions on China. A Global Times report suggested that the idea to restrict those chips had been under consideration since Biden's term. 

 

According to a Reuters report published in May this year, Nvidia was planning to release a downgraded version of its H20 chips for China after the US export restrictions were imposed on the original model. 

 

China's response to US curbs on H20 chips

 

China has repeatedly criticised the US' abuse of export control measures and crackdown on its tech firms. According to a Financial Times report, tech giants in China began the process of switching their development of artificial intelligence to homegrown chips. The report suggested that Alibaba, Tencent, and Baidu are among those that have started to test alternative semiconductors to meet surging artificial intelligence-related internal demand and client needs.

 

Change in US policy

 

The development comes amid a preliminary trade deal between the US and China last month, which sought China to resume the exports of rare earth and the US to relax its export curbs, CNBC reported.

 

The announcement of a potential policy reversal comes as Huang met with US President Donald Trump last week and policymakers in Washington. He also met with officials in Beijing as part of his efforts to boost artificial intelligence cooperation, highlighting Nvidia's support for open-source research and global AI development.

 

In his meeting with Trump and policymakers in the US, Huang reaffirmed Nvidia's support for the Trump administration's efforts in job creation, including the US' aim to be a leader in global AI. Meanwhile, in China, it was reported that Huang met officials to discuss the benefits of artificial intelligence and ways for researchers to advance safe and secure AI for the benefit of all.