Why are the US and China competing in AI?

AI is seen as a technology that will shape economic growth, military power and global influence in this century, much as electricity or nuclear technology did earlier. That has made it a central part of US–China rivalry.

Where each side is strong:

• United States: most of the leading AI labs and frontier models, the top chip designers (Nvidia, AMD) and huge private investment.
• China: a large pool of engineers, strong government support, huge amounts of data, and fast-improving models. The DeepSeek model release in January 2025 surprised the world by showing strong performance at a fraction of the expected cost.

The chip battle:

• The US has imposed export controls to limit China's access to the most advanced AI chips and chip-making equipment.
• Most advanced chips are made by TSMC in Taiwan, which adds to the strategic importance of Taiwan.
• China is investing heavily in its own chips.

Where India fits: India is positioning itself as a trusted partner for both technology supply chains and AI talent, while building its own capacity through the IndiaAI Mission and semiconductor fabrication projects.