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Washington Turns Its Focus on DeepSeek Amid Rising AI Geopolitical Tensions
As the geopolitical AI arms race accelerates, the United States is turning a critical eye toward China’s rapidly emerging artificial intelligence companies. One of the latest targets is DeepSeek, a Hangzhou-based firm that made headlines earlier this year for claiming that its AI models could rival or outperform US industry leaders like OpenAI and Google at a fraction of the cost. But according to a senior US State Department official, the company’s rise may not be entirely benign.
In statements provided to Reuters under anonymity, the official outlined serious concerns regarding DeepSeek’s alleged involvement in Beijing’s military and intelligence infrastructure. Notably, the US accuses the company of using shell corporations in Southeast Asia to bypass export controls and obtain restricted high-end US semiconductors—specifically Nvidia’s powerful H100 AI chips. These allegations suggest that DeepSeek has gone far beyond academic research or commercial development, veering into national security threats.
the Original Report
The US government has made its first official assessment of Chinese AI company DeepSeek, accusing it of directly supporting China’s military and intelligence services. According to a senior US State Department official who spoke to Reuters, DeepSeek has provided—and is likely to continue providing—its technology to military operations, going well beyond what could be considered legitimate open-source sharing.
The official also claims DeepSeek is working in close alignment with China’s state surveillance goals, including the transmission of user data to Chinese authorities. This concern is compounded by China’s stringent data-sharing laws, which mandate compliance from private tech companies when the government demands access.
One of the more specific allegations involves DeepSeek’s role in circumventing US export controls. The company is reportedly setting up front companies in Southeast Asia to obtain and access high-end Nvidia chips, including attempts to remotely use US semiconductors from regional data centers. While Nvidia denied knowingly supporting any such actions, the company noted that DeepSeek only accessed H800 chips—models that were specifically built to comply with US restrictions, not the more powerful H100s.
Additionally, US officials cited more than 150 references to DeepSeek in procurement records tied to China’s People’s Liberation Army (PLA) and its affiliates. While Reuters was unable to independently verify these procurement links, the official insisted this was further evidence of the company’s entrenchment in military and state projects.
What Undercode Say: DeepSeek’s Rise Is No Accident
The emerging narrative surrounding DeepSeek should be viewed not in isolation, but as part of a broader playbook by Beijing to fast-track AI dominance while circumventing global tech controls. The US government’s allegations are heavy, but not entirely surprising. Let’s examine the key dynamics at play:
- The Political Nature of AI Development in China:
Unlike in the West, where commercial AI development is often separated from military applications, China embraces a fusion doctrine. Civilian companies are expected—if not legally required—to align with state interests. DeepSeek, therefore, is likely embedded in national strategy by design, not exception.
2. Chip Shortages, Creative Workarounds:
The global semiconductor supply chain has become a new Cold War battleground. DeepSeek’s alleged use of shell companies in Southeast Asia signals a broader tactic among Chinese firms—leveraging third-party regions to legally or semi-legally acquire restricted hardware. These routes highlight a dangerous loophole in enforcement.
3. The Nvidia Gray Zone:
While Nvidia maintains it complies with US export rules, the existence of “weaker” H800 chips is a regulatory compromise that leaves room for abuse. DeepSeek’s reported use of these chips, even if legal, suggests the boundaries between what’s allowed and what’s intended are growing increasingly blurry.
4. Data Sovereignty as Weapon:
With data emerging as the true currency of power in the AI age, DeepSeek’s alleged sharing of user data with the Chinese government feeds concerns over global information security. Western regulators fear this data could be used not just for surveillance, but for training future military-grade AI.
5. Open-Source vs. Closed Agenda:
DeepSeek’s public image as an open-source innovator doesn’t square with accusations of secrecy and backdoor dealings. This contradiction mirrors a growing distrust of “dual-use” AI companies—those that present themselves as benign while enabling state-level cyber capabilities.
6. Echoes of the Huawei Playbook:
The controversy around DeepSeek echoes previous scrutiny of Huawei, which was accused of similar military and surveillance ties. The key difference now is scale: AI is more pervasive than telecom infrastructure and may be harder to regulate or sanction effectively.
7. Southeast Asia’s Role in the Shadows:
The region has become a strategic gray zone—close enough to China for influence, but outside direct scrutiny of Western regulators. DeepSeek’s maneuvering through Southeast Asia to gain access to restricted technologies reveals the vulnerabilities of current export control frameworks.
8. The Limits of Corporate Accountability:
Even with Nvidia’s public denials and attempts at compliance, the incident demonstrates the limits of expecting corporations to act as border guards in geopolitical tech warfare. Government intervention, rather than voluntary compliance, will likely become more common.
9. A Growing Divide in AI Trust:
Incidents like this erode trust in Chinese AI globally. As the AI race intensifies, expect further bifurcation: US allies may increasingly blacklist or distance themselves from companies with even a hint of PLA collaboration.
10. Implications for AI Governance:
Finally, this raises fundamental questions about the future of global AI governance. If firms like DeepSeek are both innovating and allegedly colluding with state agendas, the world will need more than export controls—it will need a rethinking of how trust, transparency, and collaboration are defined in AI.
🔍 Fact Checker Results
✅ The US government has not previously issued a public assessment of DeepSeek—this is the first.
✅ Nvidia confirmed DeepSeek only accessed H800 chips, not the banned H100s.
❌ No independent verification exists for the 150+ PLA procurement records linked to DeepSeek.
📊 Prediction
Expect the United States to tighten export controls even further, possibly extending restrictions to chips like the H800 and pressing Southeast Asian governments to monitor AI-related data center usage more closely. DeepSeek, in turn, may pivot toward domestic chip sources or deepen its reliance on China’s homegrown semiconductor initiatives. Long term, this event accelerates the technological decoupling between China and the West.
References:
Reported By: timesofindia.indiatimes.com
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