Welcome back,
US politics continues to loom large over tech in Asia.
Temu and Shein are among the fast-growing Chinese e-commerce sellers to be hit hard by the end of the de minimis tariff exemption. That means no more cheap prices and, for Shein, potentially an end to its IPO plan, which has already lagged for more than a year.
Politics is also eating into AI, with Nvidia fighting to retain its China-based business as Chinese juggernaut Huawei expands into chip production—and it has begun to supply products to Chinese data centres. The US may revamp its restrictions on AI tech, but Nvidia has been hurt and may continue to hurt.
Elsewhere, Proton Mail may be blocked in India and Apple is doubling down on the tough challenge of increasing its manufacturing there.
All that and more in this issue—have a great week!
Jon
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Politics is also having a seismic impact on Chinese e-commerce players Temu and Shein after the US dropped its de minimis tariff exemption which had allowed goods valued at under $800 to enter the US tax free.
Temu now plans to sell only US-based goods from local merchants in the country. That means no more cheap Chinese imports and rising prices—initial prices rose nearly 150% due to ‘import duties.’ The impact on Shein will be more profound as its planned IPO in London, which it has slowly inched towards, may have stalled. The firm’s valuation is said to have drastically dropped from $90 billion to $30 billion in reflection of the US shift—and it may restructure its North American unit altogether.
These changes will also impact US advertising providers, which had enjoyed the fruits of Shein, Temu and TikTok Shop’s rise. Only Amazon spent more on digital advertising in America. The new economics behind these Chinese companies’ business is sure to change that.
Huawei has long been a major force in China’s efforts to develop technology self-sufficiency (it’s a major benefactor) and now the firm is developing a chip production line in Shenzhen to broaden its focus even further.
The FT reports that it is leading development at three sites in its home district of Guanlan. Satellite images confirm that construction has been ongoing since 2022.
Restrictions on Nvidia chips also led Huawei to develop its CloudMatrix 384 AI chip clusters, which are now being delivered to customers in China. Another FT report confirms that more than 10 units have been sold to data centre customers which serve Chinese tech firms. The report suggests that Huawei’s speed in developing and getting the product to market has impressed analysts. It’s no surprise, then, that Nvidia has warned the US government that restrictions on its products are only enabling Huawei to become stronger, particularly around its AI capabilities.
The government may change its approach to how it handles AI chip restrictions worldwide. Under the Biden administration, it drew up a three tiered system which introduced varying limitations on access ranging from no limits for countries like Taiwan to full blocks on the likes of China, Russia, Iran and North Korea. Reuters reported that this approach could be switched for a new strategy of global licensing based on government-to-government agreements.
As always with the Trump administration, time will tell.
Nvidia is obviously not waiting around and it is already redesigning its AI chips in an effort to comply with US export rules and reach major Chinese customers like ByteDance, Alibaba and Tencent.
We’ve written fairly extensively about Apple’s strategy to shift production and manufacturing to India, but it won’t be simple with most suppliers still based on China as the FT noted.
But here’s a very interesting nugget: an India-based iPhone could cost just $20 more than a China-made one, according to JPMorgan. That’s a lot lower than the $300 premium that has been suggested for devices that were to be made in the US.
Production is ramping up across the board:
To give insight into scale: Foxconn India now employs around 80,000 staff—and its revenue has risen to more than $20 billion per year, that’s more than double its previous income.
Filed under “ridiculous this week”: an Indian court ordered the blocking of secure email provider Proton Mail after a local firm alleged that its employees received emails containing obscene and vulgar content sent via the service.
The judge apparently made the ruling because Proton Mail is said to have refused to share details about the sender of the emails. Apparently, email providers must now be held responsible for all of the users on their platform.
Proton Mail hasn’t been blocked, as of now. It remains to be seen how this case will play out.
Alibaba says its newly released Qwen3 family of AI models beats comparative services from Google and OpenAI link
DeepSeek quietly open-sourced its new Prover-V2 AI model with advanced math-solving skills on Hugging Face, a day after Alibaba launched Qwen 3.0 link
Xiaomi has unveiled its open-source AI model, MiMo, entering China’s competitive AI race link
Pony AI says it is getting closer to profitability after slashing the cost of building its most advanced autonomous driving system by 70% link
Uber is partnering with Chinese startup Momenta to launch robotaxi services outside the US and China—starting with Europe in early 2026 link
Apple plans to source 19B+ chips from the US in 2025, including from TSMC’s expanding Arizona operations link
Two Republican Congressional chairs have urged the SEC to delist 25 Chinese companies, including Alibaba, Baidu, JD.com, and Weibo link
Senior members of a Uyghur exile group were targeted in March by a China-linked spearphishing campaign aiming to install Windows malware for remote surveillance, according to Citizen Lab link
Roborock, a robot vacuum startup with investors including Xiaomi, is reportedly considering an IPO in Hong Kong link
Alibaba has launched a new “instant commerce” feature on Taobao, aiming to compete with JD.com and Meituan in China’s fast-growing one-hour delivery market link
CIA is looking to recruit new Chinese spies using social media videos that offer ‘a better life’ link
Rest Of World looks at the spectacular rise and crash of India’s largest EV company: Ola Electric and its founder Bhavish Aggarwal link
Adani Group has halted talks with Israel’s Tower Semiconductor on a $10B chip project, citing a lack of strategic and commercial fit link
Software firm Zoho has paused its $700M chipmaking plans after struggling to find a suitable tech partner, its co-founder confirmed link
Zepto’s co-founders are reportedly closing in on raising $175M through structured debt in order to boost their stakes in the business—presumably before its planned IPO link
Eternal, parent of Zomato and Blinkit, saw net profit drop 78% in Q4 due to ongoing quick commerce losses link
Now Zomato has shut down its 15-minute food delivery service Quick and homely meals segment Everyday due to low demand link
India’s financial crime agency has privately requested sales data from Apple, Xiaomi, and others as part of a probe into Amazon and Flipkart link
Identity security startup Veza raised $108M led by New Enterprise Associates link
The National Restaurant Association of India paused plans to join the Open Network for Digital Commerce (ONDC), the government-backed initiative to decentralize digital retail, due to apparent operational instability and lack of strategic commitment link
Xiaomi market share in India has crashed to 13% in India as new launches didn’t generate buzz—how it could be saddled with bloated inventory link
Oyo has postponed its planned October IPO after SoftBank opposed the timing and urged a delay until earnings improve link
A new wave of zero-commission ride-hailing apps is emerging in India, threatening the dominance of Uber and Ola by giving drivers more control over fares and higher earnings link
Malaysia’s Negeri Sembilan is emerging as a new hub for data centers as neighboring Johor slows approvals over concerns about energy and water use link
Grab beat Wall Street expectations for first-quarter revenue, reporting $773M versus estimates of $762.6M link
GoTo posted its third consecutive adjusted quarterly profit, signaling progress in cutting costs and boosting sales link
Payments firm Thunes raised $150M in Series D funding, co-led by Apis Partners and Vitruvian Partners link
The US Treasury has finally labeled Cambodia’s Huione Group a “primary money laundering concern” and proposed cutting its access to the US financial system—the firm has previously helped launder funds for North Korea and Southeast Asia-based scams link
Samsung Electronics operating profit rose slightly in Q1 link
But it warned US tariffs and policy risks will hurt demand and raise costs—which casts a gloomy outlook for its key chip and smartphone businesses link
South Korea’s SK Telecom has announced free SIM card replacements for its 25 million mobile customers following a recent USIM data breach link
Craif, a startup spun off from Nagoya University in Japan in 2018 which uses AI for early cancer detection. raised $22M link
A look at how Disco, a $20B maker of precision tools used in chip manufacturing, has run a bold experiment for over a decade: eliminating bosses and hierarchy link
Sony is reportedly considering spinning off and listing its semiconductor unit as soon as this year link
Toyota and Waymo are exploring ways to collaborate to accelerate self-driving technology link
Rakuten will invest at least $100M to expand in India, where it has 4,000 staff who help power services that include payments and other software services link
Terminal 3, a startup building privacy-focused blockchain services that’s co-founded by the former CEO of South China Morning Post, raised $8M link (disclosure: I co-write their Web3 newsletter—you should check it out)
TSMC triples down on Arizona with construction on new US plant ahead of tariffs link
Hackers working for governments were responsible for the majority of attributed zero-day exploits used in real-world cyberattacks last year, according to new research from Google link
