Comment by Riaz Haq on July 30, 2022 at 4:22pm

Semiconductor Manufacturing International Corp. has likely advanced its production technology by two generations, defying US sanctions intended to halt the rise of China’s largest chipmaker.

https://www.bloomberg.com/news/articles/2022-07-21/china-s-top-chip...


The Shanghai-based manufacturer is shipping Bitcoin-mining semiconductors built using 7-nanometer technology, industry watcher TechInsights wrote in a blog post on Tuesday. That’s well ahead of SMIC’s established 14nm technology, a measure of fabrication complexity in which narrower transistor widths help produce faster and more efficient chips. Since late 2020, the US has barred the unlicensed sale to the Chinese firm of equipment that can be used to fabricate semiconductors of 10nm and beyond, infuriating Beijing.

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Semiconductor Manufacturing International Corp has likely advanced its production technology by two generations, defying US sanctions intended to halt the rise of China's largest chipmaker. From a report:
The Shanghai-based manufacturer is shipping Bitcoin-mining semiconductors built using 7-nanometer technology, industry watcher TechInsights wrote in a blog post on Tuesday. That's well ahead of SMIC's established 14nm technology, a measure of fabrication complexity in which narrower transistor widths help produce faster and more efficient chips. Since late 2020, the US has barred the unlicensed sale to the Chinese firm of equipment that can be used to fabricate semiconductors of 10nm and beyond, infuriating Beijing.

A person familiar with the developments confirmed the report, asking not to be named as they were not authorized to discuss it publicly. SMIC's surprising progress raises questions about how effective export controls have been and whether Washington can indeed thwart China's ambition to foster a world-class chip industry at home and reduce reliance on foreign technologies. It also comes at a time American lawmakers have urged Washington to close loopholes in its Chinese-oriented curbs and ensure Beijing isn't supplying crucial technology to Russia. The restrictions effectively derailed Huawei Technologies's smartphone business by cutting it off from the tools to compete at the cutting edge -- but that company is now quietly staffing up a renewed effort to develop its in-house chipmaking acumen.

https://tech.slashdot.org/story/22/07/22/1328251/chinas-top-chipmak...

Comment by Riaz Haq on August 8, 2022 at 10:18am

#Russian #weapons in #Ukraine powered by hundreds of Western #electronic components made in #US, #Japan, #SouthKorea & #Europe. About two-thirds of the components were manufactured by US-based #technology companies. https://www.investing.com/news/stock-market-news/exclusiverussian-w...

More than 450 foreign-made components have been found in Russian weapons recovered in Ukraine, evidence that Moscow acquired critical technology from companies in the United States, Europe and Asia in the years before the invasion, according to a new report by Royal United Services Institute defence think tank.

Since the start of the war five months ago, the Ukrainian military has captured or recovered from the battlefield intact or partially damaged Russian weapons. When disassembled, 27 of these weapons and military systems, ranging from cruise missiles to air defence systems, were found to rely predominantly on Western components, according to the research shared with Reuters.

It is the most detailed published assessment to date of the part played by Western components in Russia's war against Ukraine.

About two-thirds of the components were manufactured by U.S.-based companies, RUSI found, based on the weapons recovered from Ukraine. Products manufactured by the U.S.-based Analog Devices (NASDAQ:ADI) and Texas Instruments (NASDAQ:TXN) accounted for nearly a quarter of all the Western components in the weapons.

Other components came from companies in countries including Japan, South Korea, Britain, Germany, Switzerland, and the Netherlands.

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The U.S. government said in March that Russian firms were front companies that have been buying up electronics for Russia's military. Russian customs records show that in March last year one company imported $600,000 worth of electronics manufactured by Texas Instruments through a Hong Kong distributor, RUSI said. Seven months later, the same company imported another $1.1 million worth of microelectronics made by Xilinx, RUSI said.

Texas Instruments and AMD-owned Xilinx did not respond to a request for comment about the customs data.

Russia's military could be permanently weakened if Western governments strengthen export controls, manage to shut down the country's clandestine procurement networks and prevent sensitive components being manufactured in states that support Russia, RUSI said.

Comment by Riaz Haq on August 8, 2022 at 6:01pm

U.S. Lawmakers Look to Digital Dollar to Compete With China
The Federal Reserve is considering the idea, but in no rush to join a digital-assets space race

https://www.wsj.com/articles/u-s-lawmakers-look-to-digital-dollar-t...

Lawmakers are pushing the Federal Reserve to move swiftly toward issuing a digital dollar, to combat steps from China and others they say could one day threaten the U.S. status as the global reserve currency.

The bipartisan group of lawmakers, including Reps. Maxine Waters (D., Calif.) and French Hill (R., Ark.), has sought for the U.S. to counter global competitors launching digital versions of their currencies. The House Financial Services Committee, which both serve on, might vote on related legislation as soon as next month.

Ms. Waters has framed competition over new forms of central-bank money as “a new digital assets space race.” The Biden administration and the Fed don’t share a sense of urgency.

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Fed Chairman Jerome Powell has indicated the central bank isn’t in a rush, as it confronts inflation and a slowing economy. Mr. Powell has said it is more important to get the digital dollar right than to be first to market, in part because of the dollar’s critical global role. He has also said the Fed won’t issue a digital dollar without support from elected officials. The White House has largely remained neutral on a digital dollar, with President Biden ordering a study to determine its implications for issues such as economic growth and stability.

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Some in Congress say the U.S. is already behind the curve. Among the Group of 20 major economies, 16 are in the development or pilot phase of a digital currency, according to the Atlantic Council, a Washington think tank. The European Central Bank, on behalf of countries including Germany and France, is exploring designs for a digital euro and preparing to launch a test pilot.

Mr. Hill, the Arkansas Republican, said his concerns were animated in part by China, which began real-world testing of its own central-bank–issued digital currency in 2020. In an interview, he said China’s lending practices in the developing world could make it easier for the country to promote international uses of its digital currency—a potential threat to the dollar-based global economy.

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“We should be concerned about China’s predatory practices,” he said.

Chinese authorities haven’t ruled out international use of the e-CNY, the official name for the country’s digital currency, but say it is designed for small-scale domestic use by consumers.

Analysts are looking for signs that the People’s Bank of China will take concrete steps to join with central banks elsewhere to make it possible to use digital currencies between countries. The bottom line is that Beijing is uncomfortable with the outsize role the U.S. dollar plays in global commerce and in particular fears being frozen out of the dollar-based financial system, such as in response to a conflict over Taiwan.

International transactions in a digitized currency created by China, the thinking goes, could be a defensive weapon in such circumstances because they would happen beyond the reach of the U.S.

Comment by Riaz Haq on August 9, 2022 at 9:01pm

#China tops #US in quantity and quality of #scientific papers. #Chinese #research accounted for 27.2%, or 4,744, of the world's top 1% of most cited papers, overtaking the U.S. at 24.9%, or 4,330. #UK came in 3rd at 5.5%. #India stands 4th & #Japan 5th. https://asia.nikkei.com/Business/Science/China-tops-U.S.-in-quantit...

China now leads the world both in the number of scientific research papers as well as most cited papers, a report from Japan's science and technology ministry shows, which is expected to bolster the competitiveness of its economy and industries in the future.

Research papers are considered higher quality the more they are cited by others. Chinese research accounted for 27.2%, or 4,744, of the world's top 1% of most cited papers, overtaking the U.S. at 24.9%, or 4,330. The U.K. came in third at 5.5%.

The ministry's National Institute of Science and Technology Policy compiled the report based on data from research-analytics company Clarivate. The figures represent 2019 levels, based on the annual average between 2018 and 2020 to account for fluctuations in publication numbers. The report was released Tuesday, the same day U.S. President Joe Biden signed into law the CHIPS and Science Act, a $280 billion bill framed as essential to winning economic competition with China through greater research.

Scientific research is the driver behind competitive industries and economies. Current research capabilities will determine future market shares in artificial intelligence, quantum technology and other cutting-edge fields, and may have a direct impact on national security as well.

China has quickly increased its footprint in advanced research in recent years. It overtook the U.S. in the total number of scientific papers in the 2020 report, then in the number of top 10% most cited papers in the 2021 report.

China published 407,181 scientific papers in 2019 according to the latest report, pulling further ahead of the U.S. at 293,434. In terms of the top 10% most cited papers, China accounted for 26.6% of publications, while the U.S. accounted for 21.1%.

"China is one of the top countries in the world in terms of both the quantity and quality of scientific papers," said Shinichi Kuroki, deputy director-general of the Asia and Pacific Research Center at the Japan Science and Technology Agency.

"In order to become the true global leader, it will need to continue producing internationally recognized research," he said.

Meanwhile, Japan is falling behind. It ranked fifth in the total number of publications and 10th in the top 1% most cited papers in the latest report after losing ground to India. It dropped to 12th place in the number of the top 10% most cited papers, passed by Spain and South Korea.

The number of universities in India have increased roughly 4.6 times from 243 in 2000 to 1,117 in 2018. Over two million receive a bachelor's degree in the sciences each year. In contrast, research Japan has slowed since the mid-2000s with no recovery in sight, stoking concerns about the effect on the country's economy and industries.

Comment by Riaz Haq on August 20, 2022 at 7:29am

Christopher Clary
@clary_co
“sanctions have hit the Russian military industrial complex as key spare parts… can no longer be sourced... Russia will increasingly become dependent on China for outsourcing hardware manufacturing &in turn weapon supplies to India will be hit.”

https://twitter.com/clary_co/status/1560943134292443139?s=20&t=...


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India exercises strategic autonomy, worried at Russia’s ‘no limit’ China tilt
India News
Published on Aug 19, 2022 08:14 AM IST
National Security Advisor Ajit Doval made it clear to his Russian counterpart that India only takes decisions based on its national interests and questioned Russia’s “no limits” partnership with China as this directly impacted New Delhi’s security concerns.

https://www.hindustantimes.com/india-news/india-exercises-strategic...

National Security Advisor Ajit Doval had a heart-to-heart conversation with his Russian counterpart Nikolai Patrushev in Moscow this week with both sides discussing developments in Indo-Pacific, Ukraine and addressing each other’s concerns in the unfolding security scenario in Asia. Doval also met the newly appointed Russian Deputy Prime Minister in-charge of weapon industries Denis Manturov.

During his Moscow visit, NSA Doval dispelled any Russian notion that India had distanced itself from its strategic partner of the past and moved closer to the western camp. He made it clear to his interlocutors that India only takes decisions based on its self-interests and national security concerns and is not bound to any camp.

However, NSA Doval also conveyed that India was concerned about Russia leaning toward China, which had a long-standing boundary dispute with India and had recently flared up by PLA’s unilateral actions in the East Ladakh sector in May 2020. He said to date the boundary issue has been hanging fire with China still to restore April 2020 status quo ante in the East Ladakh sector.

The two sides discussed the Chinese power projection post House Speaker Nancy Pelosi's August 2 Taiwan visit with Russia expressing concern over the rapid militarization of the Indo-Pacific. With Russian energy exports from Vladivostok being impacted by the growing China-US tussle in the Indo-Pacific, Moscow is concerned about the military response by Japan, Taiwan and US over the Chinese missile firing around Taiwan post Pelosi’s visit.

While the two NSAs exchanged notes over the developments in the Ukraine war, it is quite evident that the western sanctions have hit the Russian military industrial complex as key spare parts from Europe can no longer be sourced due to American sanctions. In this context, Russia will increasingly become dependent on China for outsourcing hardware manufacturing and in turn weapon supplies to India will be hit. The Ukraine war is now into its sixth month with neither the Russian nor the Ukrainian forces being able to make a decisive move towards its objectives and the conflict bleeding both the economies.

At the NSA level dialogue, the two sides discussed cooperation in atomic energy, space, trade, and investment with both countries worried about the developments in Afghanistan. Despite the Taliban being in power for an year, Afghanistan continues to be restive with no space for minorities, women and children. The Central Asian Republics are seeing increasing economic penetration by Beijing much to the chagrin of Russia with countries bordering restive Xinjiang already in the Chinese debt trap through the enticing Belt Road Initiative (BRI).

Comment by Riaz Haq on August 26, 2022 at 8:28am

Russia’s long-time chips failure coming home to roost
Russia will never be a first-rate power without a capable, innovative and commercially-oriented semiconductor industry

https://asiatimes.com/2022/08/russias-chips-failure-coming-home-to-...

In 1962, two Americans who spied for Russia and defected, Alfred Sarant and Joel Barr, proposed to turn the new Russian city of Zelenograd (“green city”) into a microelectronics and computer development and manufacturing center.

Zelenograd thus became the heart and soul of Russia’s effort to build modern electronics for its military. But it soon failed in its mission and the legacy of failure continues to this day.

Sarant and Barr, engineers who worked on classified US defense projects, mainly involving radar, had been part of the Rosenberg spy ring in the United States. Someone tipped them off that the arrests of Julius and Ethel Rosenberg were imminent.

Around the same time, British scientist and spy Klaus Fuchs was arrested in the United Kingdom. During World War II, he played a major scientific role at the US nuclear bomb-making site in Los Alamos.

Nikita Khrushchev took up Sarant and Barr’s proposal and turned Zelenograd into the heart of Soviet efforts to catch up with the US in electronics, including small computers and integrated circuits. Barr, who was a brilliant engineer, designed the first digital computers for Russia’s nuclear submarines and spearheaded the drive to build integrated circuits.

During the 1980s, the US launched a program of export controls and law enforcement efforts against Russian-backed “techno-bandits” who were supplying Russia with sophisticated equipment for their new electronics industry. Russian spying also went into high gear, going after US semiconductor designs needed to make Russian weapons more capable and “smart.”

There is a huge contrast in how the US dealt with Russia and its other emerging strategic rival, China. Russian development was stymied by strong controls while the US openly aided China in developing its now huge electronics industry.

One of the reasons Russian equipment destroyed in the Ukraine war is chock full of microchips made in the US, Europe and Asia is the plain fact that Russia cannot make them on its own. The export controls of the 1980s set the stage for Russia’s great microelectronics failure, which continues to afflict Zelenograd even today.

Russia’s two important semiconductor companies, Mikron and Angstrem, are located in Zelenograd. Angstrem was last reported in bankruptcy and there are also legal claims against former directors of its Angstrem-T division concerning “missing” equipment.

Mikron, the last great semiconductor hope for Russia, is working to develop technology that is already more than 2o years old, perhaps as out of date as 30 years. But the company is promising, not delivering.

It badly needs investments for a new foundry and for etching and laser equipment. Whether it will get the needed funding, or even if it could develop the requisite skill base, are open questions.

Bottom line: Russia cannot be a first-rate power without a capable electronics sector.

A good example is the lack of modern equipment in its aircraft and ground equipment. Russian tanks are operating without active protection systems, making them vulnerable to relatively cheap anti-tank weapons in Ukraine. Russian aircraft are flying without GPS mapping systems and some of them even lack ground targeting systems.

Comment by Riaz Haq on August 26, 2022 at 8:29am

Russia’s long-time chips failure coming home to roost
Russia will never be a first-rate power without a capable, innovative and commercially-oriented semiconductor industry

https://asiatimes.com/2022/08/russias-chips-failure-coming-home-to-...



To be sure, these shortcomings do not mean that Russia will lose its war in Ukraine. However, Russia’s indigenous deficiencies in advanced electronics certainly does mean that it is suffering huge losses in equipment and manpower.

Russia’s high-tech industry is mostly focused on military requirements. That is far different from the US, China, South Korea, Japan, Taiwan or European producers, all of which have strong commercial sectors.

In the 1980s, the Pentagon wanted very high-speed integrated circuits. The Department of Defense thus started the Very High-Speed Integrated Circuit program (VHSIC) and invested in excess of $2 billion in the effort (about $5.5 billion in 2022 dollars).

It never succeeded in making any VHSIC integrated circuits, mostly because commercial processors far outperformed what the Pentagon aimed at producing. However, it did manage to subsidize US semiconductor equipment manufacturing, stimulating an industry that shipped much of its product abroad, mainly to Asia.

The VHSIC program illustrated, if a demonstration was needed, that a competitive commercial sector is vital to progress in electronics, as it is in many other industries.

The Russian approach, on the other hand, was to do everything in secret. During the Cold War, Zelenograd was a closed city and its work was classified.

Zelenograd increasingly fell into bad habits, mainly stealing others’ designs rather than developing them indigenously. A prominent example was the “Texas chip,” an important medium-scale integrated circuit the US was using in its aircraft radars and other hardware in the 1980s.

When Zelenograd’s engineers pushed for the development of their own home design, they were told by their superiors to copy the Texas chip and drop any independent design work.


Early on, a second disease infected Zelenograd. Joel Barr was Jewish and he was able to attract a lot of Jewish scientific and engineering talent to Zelenograd, even though it was a classified area where Jews in the USSR had trouble finding employment.

That was fine with Khrushchev but he was pushed out in 1964, two years after Zelenograd got started. Barr and the Jews were purged by Khrushchev’s successor Leonid Brezhnev, who considered all Jews agents of the West and unreliable. Similar anti-Jewish purges took place in all Russian defense industries and in universities and research organizations.

This was the period where the Soviet Jewry movement gained momentum in Russia, and where Jews and dissidents were demanding, among other things, the right to emigrate. The loss of a large component of Zelenograd’s creative sector, and its leader Barr, represented a significant setback for Moscow’s microelectronics program.

In the 1980s, the US had initially estimated that Russia was within a few years of catching up with it. But as a result of Russian secrecy, purges and a lack of access to Western know-how, Russia slipped irretrievably backward and behind.

By the late 1980s, Russia was seven to 10 years behind the US. Russia’s electronics technology slide was not reversed by the end of the Cold War – in fact, things got considerably worse.

The implications for Russian military power have been huge. Without advanced semiconductors, Russia will lose out on the next generation of smart weapons that will rely on very high-speed intelligent systems powered by artificial intelligence (AI).

AI requires specialized processors built to exacting specifications. China, for example, has just announced it now has a new advanced chip (a MinerVA Bitcoin mining chip) that can potentially compete with even better ones made by the world’s top chip maker, Taiwan Semiconductor Manufacturing Company (TSMC).

Comment by Riaz Haq on August 26, 2022 at 8:31am

Russia’s long-time chips failure coming home to roost
Russia will never be a first-rate power without a capable, innovative and commercially-oriented semiconductor industry

https://asiatimes.com/2022/08/russias-chips-failure-coming-home-to-...


AI requires specialized processors built to exacting specifications. China, for example, has just announced it now has a new advanced chip (a MinerVA Bitcoin mining chip) that can potentially compete with even better ones made by the world’s top chip maker, Taiwan Semiconductor Manufacturing Company (TSMC).

While the Chinese chip is designed for Bitcoin applications, China is working toward advanced AI chips that can process massive amounts of information. China still has a way to go and lacks crucial extreme ultraviolet laser etching equipment, which it is being blocked access to by the US.

Russia may already be turning to China at least for lower-grade chips, but there is no evidence China is yet sharing any manufacturing know-how with Zelenograd. China has little to gain in helping Russia since supporting it would potentially result in broader sanctions against China’s electronics industry.

Today, Russia still lacks a credible and relevant domestic commercial electronics industry and is unlikely under current conditions to grow one in the near future. That would require significant foreign investment and access to the global electronics industry. Russia has shut itself out and what it hasn’t done to self-inflict harm, Western sanctions have done the rest.

Back in 1985, Mikhail Gorbachev visited Paris and met with then-president Francois Mitterand. Seeking a relaxation of the Cold War and better relations with the West, Gorbachev told Mitterand that Russia was merely a third-world country with nuclear weapons. Nearly 40 years later, that blunt assessment still rings true.

Comment by Riaz Haq on August 26, 2022 at 10:31am

China chipmaker SMIC to build $7.5bn plant in Tianjin
Key producer ramps up capacity as Beijing pushes for stronger semiconductor industry


https://asia.nikkei.com/Business/Tech/Semiconductors/China-chipmake...

CHENGDU, China -- Semiconductor Manufacturing International Corp. will invest $7.5 billion to construct a new factory in the city of Tianjin, the Chinese chipmaker announced Friday, as China and the U.S. race to bolster their domestic chip supplies.

SMIC, China's largest contract chipmaker, has reached an agreement to set up a new subsidiary based in an economic development zone in Tianjin. It will have the capacity to produce 100,000 12-inch wafers a month, though SMIC did not say when operations are expected to begin.

The facility will specialize in production processes of 28 nanometers or larger. U.S. authorities appear to be restricting companies there from supplying SMIC with chipmaking equipment capable of handling 10 nm or more advanced process tech, which are required for cutting-edge semiconductors.

Amid tensions with the U.S., Chinese President Xi Jinping has been working to strengthen domestic industries in order to minimize the impact of American sanctions. The semiconductor industry has been at the heart of this push. SMIC, which counts a Chinese state-owned fund among its investors, plans to double its output from 2021 levels by 2025.

In Washington, U.S. President Joe Biden signed Thursday an executive order to create an interagency council to coordinate the implementation of the recently signed CHIPS and Science Act. He aims to swiftly distribute $52.7 billion in subsidies to the industry and to rebuild domestic supply chains.

SMIC has faced headwinds recently as cooling demand for smartphones and appliances squeeze the chip market. Combined with lockdowns and other strict restrictions under China's zero-COVID policy, the company logged its first year-on-year decline in net profit in three years last quarter.

SMIC has received financing from government funds and investment companies to build plants in Shanghai and elsewhere. It could receive similar assistance this time around.

Comment by Riaz Haq on September 1, 2022 at 8:37pm

#US Orders #Nvidia to Halt Sales of Top #AI Chips to #China. Nvidea says ban on its A100 & H100 chips designed to speed up machine learning could interfere with completion of developing the H100, its flagship chip it announced this year. #geopolitics

https://www.usnews.com/news/technology/articles/2022-08-31/nvidia-s...


By Stephen Nellis and Jane Lanhee Lee

(Reuters) -Chip designer Nvidia Corp said on Wednesday that U.S. officials told it to stop exporting two top computing chips for artificial intelligence work to China, a move that could cripple Chinese firms' ability to carry out advanced work like image recognition and hamper Nvidia's business in the country.

The announcement signals a major escalation of the U.S. crackdown on China's technological capabilities as tensions bubble over the fate of Taiwan, where chips for Nvidia and almost every other major chip firm are manufactured.

Nvidia shares fell 6.6% after hours. The company said the ban, which affects its A100 and H100 chips designed to speed up machine learning tasks, could interfere with completion of developing the H100, the flagship chip it announced this year.

Shares of rival Advanced Micro Devices Inc fell 3.7% after hours. An AMD spokesman told Reuters it had received new license requirements that will stop its MI250 artificial intelligence chips from being exported to China but it believes its MI100 chips will not be affected. AMD said it does not believe the new rules will have a material impact on its business.

Nvidia said U.S. officials told it the new rule "will address the risk that products may be used in, or diverted to, a 'military end use' or 'military end user' in China."

The U.S. Department of Commerce would not say what new criteria it has laid out for AI chips that can no longer be shipped to China but said it is reviewing its China-related policies and practices to "keep advanced technologies out of the wrong hands.

"While we are not in a position to outline specific policy changes at this time, we are taking a comprehensive approach to implement additional actions necessary related to technologies, end-uses, and end-users to protect U.S. national security and foreign policy interests," a spokesperson told Reuters.

The Chinese foreign ministry responded on Thursday by accusing the United States of attempting to impose a "tech blockade" on China, while its commerce ministry said such actions would undermine the stability of global supply chains.

"The U.S. continues to abuse export control measures to restrict exports of semiconductor-related items to China, which China firmly opposes," commerce ministry spokesperson Shu Jieting said at a news conference.

This is not the first time the U.S. has moved to choke off Chinese firms' supply of chips. In 2020, former president Donald Trump's administration banned suppliers from selling chips made using U.S. technology to tech giant Huawei without a special license.

Without American chips from companies like Nvidia and AMD, Chinese organizations will be unable to cost-effectively carry out the kind of advanced computing used for image and speech recognition, among many other tasks.

Image recognition and natural language processing are common in consumer applications like smartphones that can answer queries and tag photos. They also have military uses such as scouring satellite imagery for weapons or bases and filtering digital communications for intelligence-gathering purposes.

Nvidia said it had booked $400 million in sales of the affected chips this quarter to China that could be lost if firms decide not to buy alternative Nvidia products. It said it plans to apply for exemptions to the rule.

Stacy Rasgon, a financial analyst with Bernstein, said the disclosure signaled that about 10% of Nvidia's data center sales were coming from China and that the hit to sales was likely "manageable" for Nvidia.

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