Trade tension between the US and China has been at an all-time peak now for multiple reasons. Unfortunately, NVIDIA has found itself in the midst of everything that has been happening. The drama around NVIDIA H200 AI chips doesn’t seem to be stopping anytime soon.
China allows DeepSeek to buy NVIDIA’s cutting-edge H200 AI chips, with undisclosed conditions
According to an exclusive report by Reuters, Chinese authorities have now cleared their top AI startup DeepSeek to purchase NVIDIA’s H200 AI chips, although final conditions are still pending. The news comes as a surprise, given how the issue around H200 AI chips has been handled by both countries.
Last year, the U.S. had effectively blocked shipments of NVIDIA’s most powerful AI chips to China, citing national security concerns. Another angle to that export control is that the US doesn’t want to give a competitive edge to China in the AI race. Later in the year, the US loosened its grip and eventually allowed NVIDIA to resume limited shipments, but with a catch. Every sale reportedly accounts for a 25 percent cut to the US government, which makes China’s access both expensive and tightly monitored.
At the time, China had been skeptical even after the US green-lighted the H200 chip export. That’s mostly because, on one hand, there was pressure to secure cutting-edge AI chips. On the other hand, Chinese officials remained cautious about over-reliance on U.S. suppliers, especially when domestic AI development was already under massive pressure.
You may also like: NVIDIA reportedly plans to export H200 AI chips to China by mid-February 2026
Why NVIDIA’s H200 AI chip is in such high demand
The demand for NVIDIA’s H200 isn’t hard to explain. The H200 is built specifically for large-scale AI workloads, including generative AI training and inference. It features HBM3e memory, higher bandwidth, and significantly improved performance for large language models.
For companies racing to train bigger, more capable AI models, the H200 chip is a lucrative option. In this context, DeepSeek’s access to the H200 chip could mean faster model training, better efficiency, and a chance to compete with global AI players.
China has multiple factors to consider
DeepSeek’s clearance suggests China may be taking a more pragmatic approach. Rather than shutting the door entirely, regulators appear willing to allow controlled access, provided certain conditions are met. However, skepticism around the import remains. Beijing has been vocal about boosting homegrown AI chips, and reliance on NVIDIA is far from ideal in the long term. But until local alternatives fully catch up, demand for NVIDIA’s most advanced accelerators isn’t going away.
As far as NVIDIA is concerned, every approval brings revenue, but at the same time, it remains under the tight scrutiny of the United States. And with geopolitical tensions still simmering, the H200 saga looks far from over.
