Chinese AI Startup Accesses Banned GPUs via Cloud Loophole

A recent investigation by the Wall Street Journal has revealed that a Chinese AI startup, INF Tech, has managed to gain access to 2,300 Nvidia Blackwell GPUs, which are banned from being sold to China, by exploiting a loophole through cloud services. This scenario unfolds as INF Tech, a Shanghai-based firm specializing in AI for finance and health applications, arranged to rent computing power from an Indonesian telecommunications company, Indosat Ooredoo Hutchison. Notably, these GPUs were acquired from Aivres, a U.S.-based partner of Nvidia, which is believed to have ties to Inspur, a Chinese tech firm blacklisted by the U.S. government due to its connections with the Chinese military, although Aivres does not publicly disclose its ownership structure. The deal began in California, where Aivres purchased the GPUs legally under U.S. export rules, which allows it to operate as long as it complies with regulations.

Indosat then procured 32 Nvidia GB200 server racks, each containing 72 Blackwell chips, totaling 2,304 GPUs in a deal valued at approximately $100 million. This arrangement was not made without a prior customer; INF Tech was secured as a client before the purchase was finalized. The servers were scheduled for installation in Jakarta as of October 2025. While this transaction might raise eyebrows due to the geopolitical tensions surrounding tech exports to China, the involved parties, including Indosat, INF Tech, and Fudan University, are not listed on the U.S. Entity List, suggesting that the deal is technically compliant with existing regulations.

The implications of this transaction are significant for the broader tech industry, raising questions about hardware access and competitive practices. Critics argue that even if these companies are currently compliant, the potential for future collaboration with the Chinese state remains a concern, as China can compel corporations to cooperate with its military if necessary. Moreover, the Biden administration's proposed AI Diffusion Rule, which could have prevented such deals, was not implemented by the previous administration. In contrast, Nvidia has advocated for more lenient export controls, emphasizing the need to maintain U.S. leadership in AI technology. A Nvidia spokesperson stated that their compliance team evaluates partners before shipments, underscoring their commitment to following U.S. regulations. INF Tech has assured that it does not engage in military-related research and adheres to U.S. export laws. Indosat's CEO, Vikram Sinha, reiterated that they work with multinational corporations and that all customers, regardless of their origin, must comply with regulatory standards. This development underscores the complexities of hardware procurement for businesses and developers navigating a rapidly evolving landscape where geopolitical factors significantly influence technology access and innovation.