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India’s IT Minister Praises DeepSeek’s Low-Cost AI, Draws Parallels with IndiaAI Mission

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India’s IT minister, Ashwini Vaishnaw, has praised Chinese startup DeepSeek for its groundbreaking low-cost AI assistant, highlighting the startup’s frugal approach as a model that resonates with India’s own AI ambitions. Speaking at an event in Odisha, Vaishnaw drew a comparison between the $5.5 million investment DeepSeek used to create a powerful AI model and India’s $1.25 billion commitment to the IndiaAI mission.

The IndiaAI mission, announced in March, aims to develop a robust AI ecosystem by funding startups and creating the necessary infrastructure to support AI innovation. Vaishnaw’s comments came as he pointed out the cost-effectiveness of DeepSeek’s approach, which took just two months and under $6 million to develop its AI model using Nvidia’s less-advanced H800 chips.

DeepSeek’s success has been a game-changer in the AI sector, surpassing OpenAI’s ChatGPT in downloads on Apple’s App Store. The startup’s impressive performance challenges the prevailing belief that China is far behind the U.S. in the AI race and raises questions about the high costs traditionally associated with building AI models.

Vaishnaw’s statement also appeared to counter remarks made by OpenAI CEO Sam Altman during a visit to India last year. Altman had expressed skepticism about India’s ability to develop a competitive AI model on a $10 million budget, calling it “totally hopeless” to compete on training foundation models. Vaishnaw’s comments are now drawing attention, especially as Altman is set to visit India again in early February amid a legal battle with Indian digital news and book publishers over copyright issues.

 

Trump Administration Weighs Stricter Curbs on Nvidia’s China Sales

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The Trump administration is reportedly considering tightening restrictions on Nvidia’s sales of its H20 chips to China, according to sources familiar with the matter. These chips, designed to run artificial intelligence (AI) software, were developed to comply with existing U.S. restrictions on shipments to China, which were initially put in place during the Biden administration. The discussions, still in their early stages, have been ongoing for more than six months, with some elements of the conversation stemming from the previous administration’s stance on technology exports to China.

The potential move to limit Nvidia’s sales of these chips comes amid growing concerns about China’s progress in AI development. China’s recent launch of DeepSeek, an AI assistant that reportedly uses less data and costs significantly less than existing models, has raised alarms that China may be closing the gap on the U.S. in AI technology.

Nvidia has stated that it is “ready to work with the administration as it pursues its own approach to AI.” Following the news, Nvidia’s stock, which was already in decline, saw slight additional losses. The White House has not yet commented on the matter.

While the Biden administration previously enacted a broad set of restrictions barring AI chip exports to China and limiting shipments to other countries, certain AI chips like Nvidia’s H20 remain permissible for export. The potential tightening of these regulations underscores growing tensions over the global AI race and the strategic importance of controlling the flow of advanced technology.

 

DeepSeek’s Chatbot Scores Low in NewsGuard Audit, Trails Western Rivals

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DeepSeek, a Chinese AI startup, saw its chatbot underperform in a recent NewsGuard audit, achieving just 17% accuracy in delivering accurate news and information. The audit compared DeepSeek’s chatbot with Western AI models, including OpenAI’s ChatGPT and Google’s Gemini, ranking it tenth out of eleven. DeepSeek’s chatbot was found to repeat false claims 30% of the time and provide vague or unhelpful answers 53% of the time in response to news-related queries, leading to an overall fail rate of 83%. In contrast, Western competitors had an average fail rate of 62%.

This performance raises questions about the quality of DeepSeek’s AI technology, which the company has touted as being on par with or superior to OpenAI’s models, at a fraction of the cost. Despite its low accuracy score, DeepSeek’s chatbot quickly became the most downloaded app on Apple’s App Store, igniting concerns about the United States’ dominance in AI and contributing to a market downturn that resulted in a $1 trillion loss in U.S. tech stocks.

NewsGuard used 300 identical prompts to assess DeepSeek and its Western counterparts, including 30 based on false claims circulating online. The topics of these prompts included incidents like the killing of UnitedHealthcare executive Brian Thompson and the downing of Azerbaijan Airlines flight 8243. DeepSeek’s chatbot also reiterated the Chinese government’s stance on certain issues, even when those topics were unrelated to China, such as in the case of the Azerbaijan Airlines crash.

Despite its poor accuracy, some analysts suggest the significance of DeepSeek’s breakthrough lies in its affordability, with D.A. Davidson’s Gil Luria pointing out that it can answer questions at 1/30th the cost of comparable models. However, as with other AI models, DeepSeek was found to be particularly susceptible to repeating false claims, especially when used to create or spread misinformation.