Image source, Andrew Harnik/Getty Images
How close are President Donald Trump and Jensen Huang?
The answer is, very close.
Former Nvidia chief Jensen Huang was among the few businessmen who could meet US President Donald Trump directly.
He had met Trump several times. He also accompanied him on the UK tour. He also boarded Air Force One with Trump during his visit to China in May.
Jensen Huang isn't just a tech billionaire who wants access to the president.
He became an important part of the larger national security debate going on within the Trump administration. This debate was about how much of America's most modern technology should be allowed to be sold to China.
Nvidia manufactures the chips that power the Artificial Intelligence i.e. AI revolution.
America has imposed restrictions on the export of the most advanced processors to China from 2022. America believes that Beijing can use them to increase its military and technological strength.
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However, it is not easy to implement these restrictions. Chips can be sold legally to customers in countries like Singapore and Malaysia. After this they can be sent to China.
Chinese companies can also rent computing capacity through data centers located outside the country.
Jensen Huang has long said that these restrictions are counterproductive. His argument was that this would exclude Nvidia from a major market. It also gives an opportunity to Chinese companies to develop their options.
Trump is also sympathetic to Jenson Huang's views.
Image source, Reuters
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Last year, he allowed Nvidia to resume sales of some chips in China.
In return, an arrangement was made to take a part of the company's income. However, Nvidia's Blackwell Ultra chips are still banned.
But now this business is not as simple as before.
The allegations related to the relationship between Jensen Huang and Alice Huang have raised new questions.
Alice Huang has no family relationship with Jensen Huang. She has been a former officer of Singapore-based company Megaspeed.
These allegations have raised suspicions that the target of a foreign intelligence agency was not just an influential businessman, but a person who had access to the US President.
According to reports, American intelligence agencies suspect that Alice Huang may have connections with Chinese intelligence agencies. However, Beijing has rejected these allegations.
Nvidia's board says that the company's intelligence information or documents related to national security have not been compromised.
But this incident has raised a big question.
What information did the American administration have about this? And what steps did he take after this?
Questions raised on Howard Latnick's role
Image source: Cornell Watson/Bloomberg via Getty Images
The responsibility of the US Commerce Department is to control the export of sensitive American technology. There was also pressure on this department to take action regarding megaspeed.
MegaSpeed is a customer company of Nvidia. She was suspected to be helping in sending modern chips to China through other routes.
On Thursday, MegaSpeed Chief Executive Officer Tan Yong Pong, also known as James Tan, said the company strictly adheres to US export control laws.
He said that the company is committed to working in a transparent manner with the US government. MegaSpeed has cooperated with the US Commerce Department's investigation.
Highly classified information regarding concerns regarding Alice Huang and MegaSpeed was shared with Commerce Secretary Howard Latnick.
According to the report, Latnik refrained from taking action against the company. Now his decision is being investigated.
Some senior officers wanted strict action
However, some other senior officials of the US administration wanted strict action in this matter.
US Finance Minister Scott Besant was also among those who raised questions as to why MegaSpeed was not included in the Commerce Department's list of banned companies.
On Friday, Besant raised questions on the Commerce Department in this matter.
He told CNBC that many agencies of the government were in favor of putting Megaspeed in the list of banned companies for several months.
He said, "But the right to take the final decision rests with the Commerce Department. So you will have to ask about its internal process."
Allegation of investigation being stopped after Nvidia's intervention
Image source, John MACDOUGALL / AFP via Getty Images
Another question arises in this matter. After all, why was the ongoing investigation against Singapore company MegaSpeed stopped after Nvidia's intervention?
According to a New York Times report, Nvidia's general counsel had contacted Commerce Department officials investigating alleged chip smuggling into China on MegaSpeed's behalf.
The report claimed that the Nvidia official had cited a senior appointed official of the Trump administration. After this, the Commerce Department reportedly stopped the investigation and handed over the case to the Justice Department.
This entire incident has revealed major differences within the administration regarding Trump's China policy.
Jensen Huang wanted Nvidia to get access to the Chinese market. At the same time, some other officials of the administration were worried about its impact on national security.
Howard Latnick got caught in the middle of this entire controversy. Now political pressure regarding this matter is also increasing.
Questions raised in US Parliament also
Image source: Alex Kraus/Bloomberg via Getty Images
Lawmakers from both major parties of the US Congress are demanding answers in this matter. Democratic lawmakers have begun an investigation into how the Commerce Department investigated Chinese companies that received permission to purchase AI chips.
Republican lawmakers are also raising questions on the attitude of the Trump administration. This controversy has not ended even with the resignation of Jenson Huang.
Republican MP John Moolnaar, chairman of the Special Committee of the US House of Representatives on China, said that the success of Nvidia and other American AI companies is in the interest of the country. But companies should never jeopardize America's security by giving the most modern chips to Chinese companies.
At the same time, senior Democrat MP Elizabeth Warren in the Senate Banking Committee said that Huang's resignation does not end his responsibilities.
He has sought answers from Howard Latnick. Warren wants to know why the shortcomings in the restrictions on the export of American technology have not been removed yet.
Meanwhile, on Wednesday, Jensen Huang's team told Republican lawmakers that it is ready to attend the closed-door hearing and present its case.
BBC has also sought response from the White House on this matter. However, he has not received any reply yet.
But the White House has told the New York Post that President Trump has full confidence in Howard Lutnick. The White House described him as the Commerce Minister who brought the biggest change in modern history.
This statement given in support of Latnik is very important. Especially at a time when reports are coming out that some administration officials are considering removing him from the post.
Answer is also being sought from Trump
Image source: Kevin Dietsch/Getty Images
Some questions are very important in this whole matter. If Howard Latnick had been warned about the dangers in advance, why did his department not take action?
And if other senior officials of the administration were pressurizing for action, then why was there so much delay in taking the decision?
BBC News has also sought response from the US Commerce Department on this matter.
But an even bigger question is about Donald Trump.
The US President had a close relationship with Jensen Huang. He also had a direct role in the decisions related to selling chips to China.
According to the New York Times report, he was also informed about the concerns of intelligence agencies.
In such a situation, it is becoming difficult to dismiss this entire controversy by calling it the mistake of just one businessman or one government department.
This controversy has started from Jensen Huang's personal life. But now the questions related to this have directly reached the White House.
After all, how much influence did Huang have in the American administration? How much information did President Trump know about this entire matter? And whose responsibility was it to protect America's most sensitive technology?
Published by Collective Newsroom for the BBC.
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