China's DeepSeek ups AI stakes as R2 rumours fly fast
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Amid tariff turfs, China is rumoured to advance its supremacy in artificial intelligence (AI) model race by releasing DeepSeek R2 , the second version of reasoning model which shook US stock markets in February.According to some reports in the Chinese media, DeepSeek R2, expected to be released this week, will be 97.3% cheaper than OpenAI's GPT-4o model and 100% trained on Huawei's Ascend 910B GPU cluster, establishing China's independence from American AI chips. Here's a look at what it will mean for the AI ecosystemIf the model performs on a par with competitors on global benchmarks, DeepSeek could establish Huawei as the first serious competitor to NVIDIA, market watchers wrote on X. The previous model released by the Hangzhou, China-based AI startup had wiped off $1.5 trillion off US stock markets, tumbling stocks of tech giants like NVIDIA, Alphabet and Microsoft.Meanwhile, Meta, which has been an open-source category leader until now is also expected to lose market share with DeepSeek also offering its models free-to-access. This comes at a time when OpenAI is also looking to release its first open-source model soon.In terms of size, DeepSeek R2 will be comparable to OpenAI's largest model so far GPT 4.5 code-named Orion with 1.8 trillion parameters. Meanwhile, DeepSeek R2 is expected to have 1.2 trillion parameters trained on 5.2 petabytes of training data.The pricing for consuming the model through APIs is expected to be $0.7 per million input tokens and $0.27 per million output tokens, which is 97.3% cheaper than OpenAI.
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Indian Express
43 minutes ago
- Indian Express
Trump says China trade deal ‘done': 55% tariff, supply of rare earth minerals
President Donald Trump said Wednesday that the United States has reached a trade agreement with China, including an easing of curbs imposed by Beijing on export of rare earth minerals and magnets that are key inputs for industries ranging from automobiles to electronics. 'Our deal with China is done, subject to final approval with President Xi and me,' Trump said in a post on Truth Social. He said China would supply 'any necessary rare earths' and magnets, while the US would make concessions on allowing Chinese students to attend American universities. The Trump administration had recently begun to clamp down on the presence of Chinese nationals on US college campuses. 'We are getting a total of 55% tariffs, China is getting 10%. Relationship is excellent!' Trump wrote, without elaborating. Bloomberg quoted a White House official as saying that the agreement allows the US to charge a 55 per cent tariff on imported Chinese goods, which, crucially, includes a 10 per cent baseline 'reciprocal' tariff, a 20 per cent tariff for fentanyl trafficking, and a 25 per cent tariff reflecting pre-existing tariffs (imposed by Trump in his first term, that the Biden administration persisted with). China would charge a 10 per cent tariff on American imports, the official said. Though the details of the deal were still unclear, analysts predicted that China seems to have gained the upper-hand after its rare earth restrictions prompted US carmakers, including Ford Motor and Chrysler, to cut production. Significantly, Trump said a final deal is subject to approval from him and Chinese President Xi Jinping. Chinese state media said earlier Wednesday that Beijing had reached a 'framework' for an agreement with the US during talks in London, but there was no official response from China on Trump's subsequent claims on Truth Social. Earlier, both the negotiating sides said they had agreed in principle to a framework for dialling down trade tensions between the world's two biggest economies. After the meeting in London — the second time the two sides have met in the last couple of months, since Trump's sweeping tariff onslaught — there were indications of a reconciliation. What is beginning to get clearer after the second meeting is that this is perhaps not how the US imagined the trade war to unfold. China is beginning to dictate the direction of the bilateral talks, with the US almost seen as requesting for much-needed concessions on the resumption of supplies of critical inputs. In the first round of talks in Geneva, the US delegation led by Treasury Secretary Scott Bessent had asked the Chinese to cut its tariffs in tandem with theirs, primarily because the Americans were facing the heat back home from the early fallout of the high tariffs, including empty shelves at grocery stories and surging prices of daily use commodities. In London, the US side is learnt to have specifically asked the Chinese to 'suspend or remove' restrictions on rare earths magnets, which had forced a supply-chain crunch. The London meeting follows a call between Trump and Xi on June 5, which was initiated by the White House — the first call since Trump's reciprocal tariff announcement. After the London talks, US Commerce Secretary Howard Lutnick said the deal should result in restrictions on rare earth minerals and magnets 'being resolved'. 'We have reached a framework to implement the Geneva consensus… Once the Presidents approve it, we will then seek to implement it,' he said. 'The two sides have, in principle, reached a framework for implementing the consensus reached by the two heads of state during the phone call on June 5 and the consensus reached at the Geneva meeting,' the BBC quoted China's Vice Commerce Minister Li Chenggang as saying. Chinese export controls over rare earth minerals were high on the agenda of the meetings. While Beijing has not imposed an outright ban on the export of rare earth magnets, the process has been made very difficult; it could take a long time to source, posing shortage risks. Rare earth magnets, especially neodymium-iron-boron (NdFeB) magnets, are crucial for EV manufacturing. They provide the strong magnetic fields needed for efficient and powerful electric motors, including traction motors that drive EVs. These magnets also play a major role in other EV components like power steering systems, wiper motors and braking systems. China has a virtual stranglehold over these rare earth magnets. In May, talks held in Geneva led to a temporary truce after the tit-for-tat tariff increases by both sides, which led to duties that peaked at 145 per cent. Trump called the outcome of the talks in Switzerland a 'total reset', which brought US tariffs on Chinese products down to 30 per cent, while Beijing cut duties on US imports to 10 per cent. Both sides also agreed to a 90-day deadline to try to reach a trade deal. However, the US and China have since accused each other of breaching the deal. The US has said that Beijing has been dragging its feet on opening up exports of rare earth metals and magnets while the Chinese claim that Washington has restricted its access to American goods such as semiconductors and other related technologies linked to artificial intelligence. US Trade Representative Jamieson Greer had said China had failed to roll back restrictions on exports of rare earth magnets. In the run-up to this week's talks, the Chinese Ministry of Commerce said on Saturday that it had approved some applications for rare earth export licences. The problem for the US is that the Chinese side has wrested some advantage, especially by leveraging its strategy of weaponing its dominance in key sectors. Rare earth minerals and magnets is one such area, where the US is now desperate for concessions. Both sides have since claimed breaches on non-tariff pledges, but the Americans clearly seem more eager for a reconciliation, given the impact of the Chinese blockade on its key manufacturing sectors. These Chinese trade blockades are already impacting companies in other geographies. Hamamatsu-based small car maker Suzuki Motors, for instance, said last week it plans to suspend the production of its flagship Swift compact hatchback due to China's rare earth restrictions, becoming the first Japanese automaker to be impacted. There are similar worries among other manufacturing entities across the world, including in the US. Anil Sasi is National Business Editor with the Indian Express and writes on business and finance issues. He has worked with The Hindu Business Line and Business Standard and is an alumnus of Delhi University. ... Read More
India.com
an hour ago
- India.com
India Won Operation Sindoor – But What Does The Army Want Next, And Who Poses The Greatest Threat?
New Delhi: India crushed Pakistan's assault during Operation Sindoor. But after the dust settled, something more alarming came into view. China was not sitting on the sidelines. It was pulling strings from behind the curtain. Indian radars picked up Chinese-made jets in Pakistani skies. Chinese missiles were used to target Indian bases. Beijing was deeply involved. That means India was not fighting just Pakistan. India was up against two enemies at once. Military officers have sounded the alarm. They want India's defence budget raised to 2.5% of the Gross Domestic Product (GDP). Right now, the defence allocation stands at just 1.9%. A huge portion of that money goes into salaries and pensions. Only a quarter of it helps modernise the military. This cannot continue. Not when two hostile neighbours are preparing for something bigger. China has been pumping weapons into Pakistan. In the May 7-10 clashes, Pakistan deployed Chinese J-10 jets and HQ-9 missile systems. Beijing has promised to send more – stealth fighters, long-range air defence weapons and new-generation drones. China is flooding Pakistan with cutting-edge military tools. Pakistan's economy is in crisis. But even then, Islamabad raised its defence budget by 20%. It cut development. It ignored debt. It focused on weapons. India must respond, believe experts, arguing that it is time for total self-reliance in defence production. India must build fighter jets, drones, loitering munitions and missiles on its own. The private sector must step in. Half-measures will not do. Half-prepared armies lose wars. India's Advanced Medium Combat Aircraft (AMCA) project has started moving. But it must move faster. Tejas took decades. The same mistake cannot happen again. The Indian Air Force is short on fighter squadrons. It has just 30. The target is 42.5. Drones are the new face of war. Swarm drones. FPV kamikaze drones. Loitering drones. India needs all of these, and it needs them in bulk. No country will come to India's rescue in a full-scale war. India must stand on its own. During Operation Sindoor, India used Russian S-400s, Israeli Barak-8s and its own Akash missiles. These systems intercepted and neautralised many Pakistani drone and missile attacks. But more layers are needed. DRDO must now accelerate two things – short-range air defence systems and long-range strike missiles like Project Kusha. Military reform is also crucial. India has a huge army. It must cut unnecessary spending. It must remove red tape from weapons procurement. And it must create joint theatre commands that allow the Army, Navy and Air Force to fight as one. A senior military commander put it bluntly. India is now staring at a superpower that is feeding a hostile neighbour. Pakistan may fire the bullets. But China is loading the gun. India cannot look away anymore. The next battle may not wait for long.
Economic Times
an hour ago
- Economic Times
Rare earths and magnets minerals elements: Why are these giving China edge in trade war with USA?
Rare-earth magnet Synopsis Rare earths and magnets minerals elements have hogged all the limelight during the US-China trade war. US-China trade deal has finally been chalked out, according to President Donald Trump. Analysts have claimed that China was counting on one crucial advantage as it strived to grind out a deal to ease its high-stakes trade war with the United States -- dominance in rare earths. Now question arises how rare earths have become a key sticking point in talks between the US and China. ADVERTISEMENT Rare Earths Minerals Elements Used in electric vehicles, hard drives, wind turbines and missiles, rare earth elements are essential to the modern economy and national defence, AFP reported. "The Middle East has oil. China has rare earths," Deng Xiaoping, the late Chinese leader whose pro-market reforms set the country on its path to becoming an economic powerhouse, said in 1992. Since then, Beijing's heavy investment in state-owned mining firms and lax environmental regulations compared to other industry players have turned China into the world's top supplier, as per AFP now accounts for 92 percent of global refined output, according to the International Energy the flow of rare earths from China to manufacturers around the world has slowed after Beijing in early April began requiring domestic exporters to apply for a licence -- widely seen as a response to US tariffs. ADVERTISEMENT Under the new requirements -- which industry groups have said are complex and slow-moving -- seven key elements and related magnets require Beijing's approval to be shipped to foreign buyers. Why Does USA Need Rare Earths? ADVERTISEMENT Ensuring access to the vital elements became a top priority for US officials in talks with Chinese counterparts."The rare earth issue has clearly... overpowered the other parts of the trade negotiations because of stoppages at plants in the United States," said Paul Triolo, a technology expert at the Asia Society Policy Institute's Center for China Analysis, in an online seminar on Monday. ADVERTISEMENT That disruption, which forced US car giant Ford to temporarily halt production of its Explorer SUV, "really got the attention of the White House", said reportedly rely on Chinese rare earths for producing its defence equipment even as trade and geopolitical tensions deepen. ADVERTISEMENT An F-35 fighter jet contains over 900 pounds (more than 400 kilograms) of rare earth elements, noted a recent analysis by Gracelin Baskaran and Meredith Schwartz of the Critical Minerals Security Program at the Center for Strategic and International Studies. China has Largest Reserves Pentagon is trying to catch up, with its "mine-to-magnet" strategy aiming to ensure an all-domestic supply chain for the key components by 2027. The challenge facing Washington to compete with Beijing in rare earths is compounded by sheer luck: China sits on the world's largest reserves. Q1. Who is President of USA?A1. President of USA is Donald Trump. Q2. What are usage of Rare earths and magnets? A2. Used in electric vehicles, hard drives, wind turbines and missiles, rare earth elements are essential to the modern economy and national defence, AFP reported. (You can now subscribe to our Economic Times WhatsApp channel) (Catch all the US News, UK News, Canada News, International Breaking News Events, and Latest News Updates on The Economic Times.) Download The Economic Times News App to get Daily International News Updates. Rare earths and magnets minerals elements: Why are these giving China edge in trade war with USA? 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