Book Excerpt | Washington’s war against Huawei put Beijing on the backfoot
Deccan ChronicleWhile China may be the largest producer of scientific papers and has probably surpassed the US in overall R&D investment, it continues to lag behind America in key technologies such as semiconductors. Even many high-end chips currently being built in Chinese foundries are subject to US sanctions, as Huawei-owned fabless semiconductor company HiSilicon found out in May 2019. Influence of the US over the supply chain for high-technology items was so great that Huawei’s much smaller rival ZTE was brought to its knees when it was put on the Entity List and had to come around to the terms imposed by Washington, which included coughing up a $1 billion fine for violating US sanctions on Iran and North Korea. The head of Huawei’s 5G business claimed in November 2019: ‘The entity listing has had no impact on Huawei’s 5G equipment whatsoever.’ And: ‘The performance and specification of the products with our own components will only be better.’ Apparently, Huawei had diversified its supplier base enough such that it had managed to supply 3,00,000 5G base stations since its blacklisting — accounting for around 75 per cent of such units supplied in the course of 2019. Self-sufficiency has understandably emerged as a popular theme, with even Alibaba founder Jack Ma saying in 2018,‘If we do not master the core technologies, we will be building roofs on other people’s walls and planting vegetables in other people’s yards.’ While the drive to attain technology independence is an admirable goal, the reality is that substituting high-end US imports will be a rather time-consuming and expensive proposition, as China will have to reinvent the wheel in many cases.