America will get 15% share from chip sales in China: Nvidia-AMD deal with government; Ban was imposed on selling AI chips in April

Two big US chip makers, Nvidia and AMD, will now give 15% of the earnings from the sale of their AI chips in China to the US government.

Taking a revenue share in this way is a completely new and unique step. The New York Times has given this information in its report quoting three people.

License to sell chips given after 15% revenue sharing deal

Last month, the Trump administration had talked about allowing Nvidia to sell its H20 AI chips in China, but licenses were not given.

Then on Wednesday, Nvidia CEO Jensen Huang met President Donald Trump at the White House and confirmed this 15% revenue sharing deal.

Just two days after this, the US Commerce Department started issuing licenses for the sale of these chips. That is, the US government has now become a partner of Nvidia’s business in China. AMD’s MI308 chip is also a part of this deal.

In April, the Trump administration had banned the sale of this chip in China, but now the sale has been allowed under this deal.

The Trump administration has interfered in international deals before as well

The Trump administration has interfered in international deals of US companies before as well. For example, in June, Japan’s Nippon Steel was given permission to invest in US Steel.

In this, the government took the so-called golden share in the company. Golden share is given to the government or a special investor in a company. Through this, they can have special control over the major decisions of the company, even if their stake is less.

The government will get around ₹ 17,000 crores from the deal

According to Bernstein Research, the government can get 2 billion dollars (about ₹ 17,000 crores) from this deal. Nvidia may sell its H20 chips worth about ₹ 1.31 lakh crore to China by the end of this year. AMD’s sales could be up to ₹ 7 thousand crore.

Selling AI chips is a threat to America’s security

Lisa Tobin, who was the China director of the National Security Council in the Trump and Biden administrations, said, “This is a wrong move. This will give China an opportunity to put more pressure. We are selling our national security for corporate profits.” Nvidia spokesman Ken Brown said the company follows US government rules. He said, “We have not shipped H20 chips to China for months, but we expect export rules to give us a chance to compete in China and around the world.”