Author : Manoj Joshi
Having moved from imitation to the frontier in AI, biomedicine, and solar, Beijing is now deciding who may follow it there, and India may be among those left waiting
Image Source: Getty Images
China is marking its arrival as a technology power in the customary fashion: by deciding who may not have its technology. By joining the United States and other advanced economies in erecting export controls around key technologies, Beijing is signalling that it now has something worth guarding. The legal architecture, too, is being assembled swiftly and in sequence.
On 16 October, the Ministry of Commerce (MOFCOM) and the Ministry of Science and Technology proposed adding AI, biomedicine, and photovoltaic technologies to China’s catalogue of technologies that are prohibited or restricted from export. The proposals are drafts and will be finalised after consultation. Once they are, restricted items will require an export licence, and prohibited items will be barred outright. Exporters will also have to disclose any transfer of covered technology before it takes place, which gives the state a window to intervene and hands it a standing view of who is seeking what.
The aim is not to block products built with these technologies; Chinese solar panels, drugs, and AI services will continue to sell. The aim is to stop transfers that could cause the loss of the underlying know-how: the process recipes, the model architectures, the production lines. Beijing is, in effect, trying to keep the capability at home while exporting the output.
Three days later, on 19 October, MOFCOM and the General Administration of Customs placed certain tunnel boring machines and their components, dredgers, and specialised excavators designed for use above 3,000 metres under export control. The altitude threshold is the giveaway. Civilian demand for such equipment at that height is slight, except where roads and tunnels are being driven through the Himalayas. India is doing exactly that, building and upgrading infrastructure along the Line of Actual Control (LAC), the de facto border. The measure never names India, but its timing is instructive. The two sides have spent the past year in a cautious thaw, marked by patrolling arrangements, resumed dialogue, and talk of an “early harvest” on the boundary. Beijing is showing that thaw and leverage are not mutually exclusive.
The logic behind the technology lists is subtler than that of a simple embargo. The aim is not to block products built with these technologies; Chinese solar panels, drugs, and AI services will continue to sell. The aim is to stop transfers that could cause the loss of the underlying know-how: the process recipes, the model architectures, the production lines. Beijing is, in effect, trying to keep the capability at home while exporting the output.
The regulatory loophole that Beijing is closing was exposed by the Manus affair. Meta was able to acquire the Chinese-founded AI agent app, a transaction that moved valuable technology and talent offshore without tripping any existing export control. Chinese authorities subsequently blocked the deal. The new draft rules are meant to ensure that no future Manus slips through on a technicality.
The wider purpose is to retain control over the technology needed to replicate Chinese industrial capacity abroad, and thereby to bind global supply chains more tightly to China. This is where the measures concern India directly. Countries pursuing a “China+1” strategy, which seek to diversify manufacturing away from China without leaving the Chinese ecosystem entirely, depend on importing not just components but also process knowledge, equipment, and engineers. A factory in India or Vietnam making solar cells or biologics needs more than a purchase order; it needs the know-how. Restrict that, and the “+1” remains a showroom rather than a competitor. India, with its production-linked incentive (PLI) schemes in electronics, solar modules, and pharmaceuticals, is the most obvious casualty.
China has acquired the means to monitor, slow, or block the flow of its AI technology whenever it chooses. A licensing regime requires no dramatic announcement, only discretion. Delays can be passed off as bureaucratic, and refusals can be left unexplained.
The AI provisions in the new notifications run to 23 proposed technologies. They cover large models, agents, chip design, computing clusters, and cyber and information-processing capabilities. The proposals are framed around safety and risk, the vocabulary Washington has also adopted for its own restrictions. For now, however, the restrictions target capabilities rather than the riskiest systems, and rules written around capabilities apply to nearly anyone building anything useful.
To promote its World Artificial Intelligence Cooperation Organisation (WAICO), Beijing proposes additional facilitation and support for technology exports that advance cooperation among members. Membership brings access; non-membership brings paperwork. It is a familiar structure: a club whose benefits are defined partly by what non-members cannot get.
According to an analysis by Bharat Reddy, nothing changes immediately, “but the basis for leverage exists.” That is the crux of the matter. China has acquired the means to monitor, slow, or block the flow of its AI technology whenever it chooses. A licensing regime requires no dramatic announcement, only discretion. Delays can be passed off as bureaucratic, and refusals can be left unexplained.
For the biomedicine list, five technologies are proposed, covering cell and gene therapies and small interfering RNA (siRNA) drugs. These are high-value fields in which Chinese firms have moved from imitation to the frontier within a decade, and in which licensing deals with Western pharmaceutical companies have multiplied. Control over them lets Beijing decide who gets to commercialise Chinese science.
The photovoltaic list, which contains 12 technologies, is the most consequential for the industry. Production technologies for thin-wafer fluidised-bed polysilicon and for perovskite cells would be prohibited outright, while others, including TOPCon and heterojunction, would need a licence. China dominates every stage of the solar supply chain, and these are the technologies that determine who will make the next generation of cells cheaply. Prohibiting the newest means competitors cannot leapfrog; licensing the rest means they can follow, but only at a pace Beijing approves.
Effectively, Beijing could be curbing exports of solar manufacturing technology to India. Analysts say China is seeking to preserve its dominance as India builds up its domestic manufacturing capabilities and tries to shake off its dependence on China. Earlier this year, New Delhi eased certain rules governing Chinese investment to encourage cooperation between Indian and Chinese companies in areas such as polysilicon and silicon wafer production. The new Chinese regulations, however, will create uncertainty for the planned collaborations.
One provision deserves particular notice. Even an overseas factory built with Chinese equipment may remain within the scope of the controls after the machines are installed. The restriction thus follows the technology across the border and persists after delivery. A plant in India or elsewhere would not simply own its machines; it would operate them under the continuing shadow of Chinese regulatory reach, which would affect upgrades, servicing, and the re-export of what they produce.
The 19 October order also recalibrated drone export controls. Covered items now include unmanned aerial vehicles (UAVs) that fly beyond natural line of sight with an endurance of three hours or more, or a range of 300 km or more. They also include radios above 30 dBmW or capable of controlling more than 10 aircraft, aerosol dispersal systems above 80 litres, high-power brushless motors, carbon-fibre propellers, and technologies for flight control, autonomous navigation, sense-and-avoid, whole-system design, and counter-UAS operations. Taken together, the list covers nearly every element from which an indigenous drone industry could be assembled, which matters to an India that is trying to build precisely that after the lessons of recent conflicts.
The pattern is unmistakable. Beijing is following Washington’s playbook, and applying it with the advantage of owning the chokepoints in several of the sectors concerned. For India, the message is that diversification away from China will be permitted only on terms that leave China indispensable.
Manoj Joshi is a Distinguished Fellow at the Observer Research Foundation.
Manoj Joshi is a Distinguished Fellow at the ORF. He has been a journalist specialising on national and international politics and is a commentator and …
ORF © 2026
Website Design and Development by Sterco Digitex
