Microsoft Plans to Urge Trump to Loosen up Restrictions on Chip Import

Key Takeaways

• Microsoft is planning to request Trump to ease up the restrictions imposed on chip export by Biden.
• It wants at least the allies of the US, such as India, Switzerland, and Israel, to be able to freely import US chips.
• However, as per reports, the Trump administration has been planning to strengthen these restrictions. So, a plea like this might not stand a chance.

Microsoft has decided to urge President Donald Trump to ease the restrictions imposed on chip exports by the previous Joe Biden administration. The said restrictions were brought into place during the final days of Biden's tenure.

Microsoft feels that at least the allies of the US should be spared of these restrictions. These countries include India, Israel, and Switzerland.

Why Did Joe Biden Restrict Chip Imports?

Joe Biden decided to impose more restrictions on the export of AI chips, especially those created by Nvidia. The initial purpose was to keep advanced AI computing powers within the US, with special focus on ensuring they don't end up in China's hands.

However, the restriction soon expanded to other countries as well, which included some of the closest allies of the US.

Biden thought that it would make the US a superpower in the AI race, but what he did not consider is that sooner or later, other countries would also figure out how to make equally good chips. And in that case, all the buyers that the US had would turn to those countries. This is exactly what Microsoft is worried about.

By restricting exports, US chip makers are missing out on some of the biggest international markets, whereas China is taking up all the lost business right from under the US's nose.

Left unchanged, the Biden rule will give China a strategic advantage in spreading over time its own AI technology, echoing its rapid ascent in 5G telecommunications a decade ago - Microsoft

However, according to the Wall Street Journal, which first published this news, the Trump administration is actually planning to strengthen these restrictions. So, whether a plea to ease them up will work or not is hard to say.

Should the US Really Restrict Chip Export?

The biggest reason the US started restricting chip exports was to keep such advanced technology out of China's grasp. However, as mentioned earlier, China is an equally adept country when it comes to tech. So, if the US won't provide it with chips, it's capable of creating its own.

Look at DeepSeek, for instance. US AI startup OpenAI was one of the first companies to popularize the idea of GenAI, but within just a couple of years, China managed to create something better, and that too, at a fraction of the cost.

Similarly, China might soon reach the US's chip prowess. The only ones that will actually lose in the process are the US chip companies, who will now have a limited customer base.

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