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Mint
6 days ago
- Business
- Mint
Are Silicon Valley CEOs of Indian origin at risk of facing what Intel's boss is?
According to US President Donald Trump, the rise of Intel's CEO, Lip-Bu Tan, is 'an amazing story." That's as much payoff as Tan can expect from his emergency meeting with Trump, who last week had demanded he 'resign, immediately" because he was 'highly CONFLICTED." We don't know if Intel will be able to convince the administration to view its CEO with less disfavour. Some in Washington are concerned about Malaysian-born Tan's long history of supporting and investing in the Chinese tech sector. And questions about how Intel intends to live up to government controls on the export of high-end technology under his leadership are, given this history, not unreasonable. Also Read: Rajrishi Singhal: Look East to grasp why Trump is ghosting India Nevertheless, it's a problematic precedent. That should worry Silicon Valley's powerful Indian diaspora in particular. Take a step back and ask yourself: Is there anything inherently questionable about a tech firm appointing a CEO with an eye for innovative and effective startups? At his venture capital firm Walden International, Tan invested in more than 100 Chinese companies, including an early bet on Semiconductor Manufacturing International Corp. Normally, this would be a count in his favour. The problem is a fear, both in Washington and in Silicon Valley, that the US and Chinese tech ecosystems are not complements but rivals. This wasn't the case in 2001, when Walden put money in SMIC. But it's certainly the general feeling today. Indian tech leaders have managed to escape similar scrutiny precisely because the tech scene here is seen as providing low-end support to US industry, not high-value competition. But how long will that be true? And what happens if it changes? Also Read: Kaushik Basu: The real costs of Trump's economic agenda are staggering New Delhi is not happy being a supporting player in the AI revolution. The country has begun to stockpile chips—compute capacity has passed 34,000 GPUs in May, according to government officials—and has already selected national champions it intends to support. Given the relative dynamism of India's startups, its tech sector will at some point produce a few success stories that challenge the dominance of US companies. That's good news for Indians. But it might make things more difficult for Indian-Americans in Silicon Valley. Across America Inc, but particularly in Big Tech, people of Indian descent have been disproportionately successful as leaders, more so perhaps than their colleagues of Chinese heritage. Think of Alphabet's CEO Sundar Pichai, Microsoft's Satya Nadella, Adobe's Shantanu Narayen and IBM's Arvind Krishna, for example. As Intel's troubles following its choice of Tan demonstrate, this might partly be because their home nation is not considered a strategic competitor to the US. That image is slowly changing in the Trump era. Indians in Silicon Valley have already discovered that things are a bit harder now. H1-B visas, for example, are a political hot-button issue, and provided the first wedge in the relationship between Trump and Elon Musk. Trump has already made it clear that he doesn't want his backing of Big Tech to mean any jobs for Indians: 'Many of our largest tech companies have reaped the blessings of American freedom while building their factories in China, hiring workers in India and stashing profits in Ireland," he said at a tech summit last month, adding: 'Under President Trump, those days are over." Also Read: India's AI boom could exceed Satya Nadella's expectations So far, corporate leaders have not had to answer any questions about their distance from the sector back home. But the political environment will get more difficult to navigate as India's tech companies achieve greater autonomy and efficiency, and the Trump administration reworks policy. The 50% tariff rate that New Delhi has been threatened with reveals how the president's mind works: He may not see India's trajectory as fundamentally different from China's, and his mercantilist soul rebels at the thought of collaborating with a future rival. An age of economic nationalism and competitive industrial policy will always be tough on cosmopolitan minorities. 'Dual loyalty' accusations gain no traction in an age of prosperous globalization, but have a long and dark history when populists seize power and turn back the clocks. The diaspora should not look at Tan's attempts to win over Trump with satisfaction or superiority. They might be next. Nor should they assume that they'll always be able to avoid similar accusations. The only reason they haven't faced them so far is that nobody thought their connections back home could ever be a problem. Here's the hard truth: India's success will mean the end of Silicon Valley's Indian-American golden age. ©Bloomberg The author is a Bloomberg Opinion columnist.
Time of India
09-08-2025
- Business
- Time of India
China's SMIC says Trump tariffs did not cause expected 'hard landing'
By Che Pan and Joe Cash BEIJING: China 's top foundry SMIC said on Friday U.S. tariff policy had not led to a "hard landing" the company had initially feared and strong domestic demand would keep its production capacity tight until October. Co-CEO Zhao Haijun told a post-earnings call the company was not consulting with customers on U.S. President Donald Trump's 100% tariff plan for chip imports but expected smaller impact, thanks to contingency plans made after the April tariffs. "After these past few months, everyone has either stocked up enough inventory for this year and next year, or found other suppliers," Zhao said, "So I think the impact will become even smaller." Previous tariff rounds had led to cost increases of less than 10% for overseas customers, he added. China raised additional duties on U.S. goods to 125% in April after Trump effectively raised tariffs on Chinese goods to 145%. On Wednesday Trump vowed a tariff of about 100% on imports of semiconductors, but excluded companies manufacturing in the U.S. or which have committed to do so. SMIC, which does not have manufacturing in the United States, was blacklisted by the U.S. commerce department in 2020. China is its dominant market, contributing 84% of second- quarter revenue, flat with the first, while the U.S. made up 12.9%, up slightly from 12.6%. SMIC's second-quarter revenue rose 16.2% on the year to $2.2 billion. Its profit attributable to owners declined 19.5% to $132.5 million, missing analysts' estimates of $183.35 million, according to LSEG data. Semiconductor Manufacturing International Corp (SMIC), as it is formally known, shipped 2.4 million eight-inch equivalent wafers in the second quarter, up 4.3% from the previous quarter. Zhao said its production capacity remained insufficient and would stay tight until October due to robust demand from domestic substitution for analog chips, WiFi and ethernet chips and controller chips for memory. SMIC's monthly production capacity expanded by 1.85% quarter-on-quarter to 991,000 wafers, with utilisation rates rising to 92.5% from 89.6% in the March quarter. But Zhao said the fourth quarter is usually a slow season for the industry and rush orders and early shipments would slow then. SMIC expects third-quarter revenue to increase by 5% to 7% from the second. SMIC's Hong Kong-traded shares were down more than 5% on Friday.
Wall Street Journal
08-08-2025
- Business
- Wall Street Journal
Chip Maker SMIC Sees Limited Impact of Trump's Tariffs
China's largest chip maker, Semiconductor Manufacturing International Corp., 981 -8.23%decrease; red down pointing triangle said the U.S. tariffs should continue to have a limited impact as demand from domestic clients is increasing sharply and overseas clients are better prepared for the headwinds. 'At least until around October this year, SMIC's production capacity will still be in short supply' as the expected hard landing of tariffs didn't happen, SMIC co-chief executive Zhao Haijun said Friday in a post-earnings call.
New Straits Times
08-08-2025
- Business
- New Straits Times
China's SMIC says Trump tariffs did not cause expected 'hard landing'
BEIJING: China's top foundry SMIC's co-CEO said on Friday that US tariff policy had not resulted in the "hard landing" that the company was initially worried about and that strong domestic demand will keep its production capacity tight until October. Zhao Haijun, co-CEO of Semiconductor Manufacturing International Corp (SMIC), told a post-earnings call that the company is not consulting with customers regarding US President Donald Trump's 100 per cent tariff plan on chip imports but expects the impact could be smaller due to contingency plans that had been made after tariffs were announced in April. China raised additional duties on US goods to 125 per cent in April after Trump effectively raised tariffs on Chinese goods to 145 per cent. Trump said on Wednesday the United States will impose a tariff of about 100 per cent on imports of semiconductors, although that will not apply to companies that are manufacturing in the US or have committed to do so. SMIC was blacklisted by the US commerce department in 2020. China is the dominant market for SMIC, accounting for 84 per cent of its revenue in the second quarter, unchanged from the first quarter, while the US contributed 12.9 per cent, slightly up from 12.6 per cent. SMIC's second-quarter revenue rose 16.2 per cent year-on-year to US$2.2 billion. Its profit attributable to owners of SMIC declined 19.5 per cent to US$132.5 million, missing analysts' estimates of US$183.35 million, according to LSEG data. SMIC's Hong Kong-traded shares were down more than five per cent on Friday. Zhao said the previous rounds of tariffs resulted in less than 10 per cent of cost increases at its overseas customers. "After these past few months, everyone has either stocked up enough inventory for this year and next year, or found other suppliers," Zhao said, "So I think the impact will become even smaller." Zhao said SMIC's production capacity remains insufficient and would remain tight until October due to robust demand from domestic substitution.
CNBC
08-08-2025
- Business
- CNBC
China's SMIC says Trump tariffs did not cause expected 'hard landing'
China's top foundry SMIC's co-CEO said on Friday that U.S. tariff policy had not resulted in the "hard landing" that the company was initially worried about and that strong domestic demand will keep its production capacity tight until October. Zhao Haijun, co-CEO of Semiconductor Manufacturing International Corp, told a post-earnings call that the company is not consulting with customers regarding U.S. President Donald Trump's 100% tariff plan on chip imports but expects the impact could be smaller due to contingency plans that had been made after tariffs were announced in April. China raised additional duties on U.S. goods to 125% in April after Trump effectively raised tariffs on Chinese goods to 145%. Trump said on Wednesday the United States will impose a tariff of about 100% on imports of semiconductors, although that will not apply to companies that are manufacturing in the U.S. or have committed to do so. SMIC was blacklisted by the U.S. commerce department in 2020. China is the dominant market for SMIC, accounting for 84% of its revenue in the second quarter, unchanged from the first quarter, while the U.S. contributed 12.9%, slightly up from 12.6%. SMIC's second-quarter revenue rose 16.2% year-on-year to $2.2 billion. Its profit attributable to owners of SMIC declined 19.5% to $132.5 million, missing analysts' estimates of $183.35 million, according to LSEG data. SMIC's Hong Kong-traded shares were down more than 5% on Friday. Zhao said the previous rounds of tariffs resulted in less than 10% of cost increases at its overseas customers. "After these past few months, everyone has either stocked up enough inventory for this year and next year, or found other suppliers," Zhao said, "So I think the impact will become even smaller." Zhao said SMIC's production capacity remains insufficient and would remain tight until October due to robust demand from domestic substitution.
