China To Invest $295 Billion In AI To Build Data Centers And Reduce Reliance On Foreign Chipmakers

As Beijing seeks to compete with the United States in the escalating AI race, Bloomberg News reported on Tuesday that China is planning to invest over 2 trillion yuan ($295.43 billion) over the next five years in the construction of data centers throughout the nation.  

According to the source, which cited persons with knowledge of the situation, the National Development and Reform Commission is one of the major government organizations creating a plan to establish a nationwide network of interconnected computer hubs. 

China’s new five-year policy blueprint laid out its ambitions to aggressively adopt AI throughout the world’s second-biggest economy and dominate emerging technologies such as quantum computing and humanoid robots. 

State firms such as China Mobile and China Telecom will operate the bulk of the data centers and ensure they are connected, according to the Bloomberg News report.  

The idea is to rely on local suppliers, including Huawei Technologies for at least 80% of technology such as AI chips, effectively squeezing out Nvidia NVDA.O and Advanced Micro Devices AMD.O, the report said, adding that the data-center blueprint remains in early discussions and details could change. 

This comes as Big Tech companies in the U.S. are expected to spend more than $700 billion this year to fund their AI buildout plans. 

China Mobile, China Telecom and National Development and Reform Commission did not immediately respond to Reuters’ requests for comment. 

Reuters reported last year that the Chinese government issued guidance requiring new data center projects that have received any state funds to only use domestically made AI chips. 

(Agency)

Also Read: TCS To Have As Many AI Agents As Human Employees Within Three Years: Company Calls AI A Major Growth Opportunity