China Drafts $295 Billion Five-Year AI Plan Targeting 80 Percent Domestic Technology Use

China is drafting a $295 billion five-year plan to build a nationwide artificial intelligence computing grid, with a target of achieving 80 percent reliance on domestic technology. The plan is designed to reduce China's dependence on U.S. chips and AI infrastructure as American export controls continue to tighten.

Details of the plan were reported by multiple technology news outlets in June 2026. The initiative would fund the construction of data centers, AI research facilities, and domestic semiconductor production across the country. Chinese officials have framed the effort as essential to national security and economic competitiveness.

The plan comes in direct response to U.S. export restrictions that have blocked advanced Nvidia chips from reaching Chinese companies. American regulators have also moved to prevent Chinese firms from obtaining restricted chips through third-party countries, including Malaysia.

Chinese technology companies including Huawei, Baidu, and Alibaba are expected to play central roles in the initiative. Huawei has been developing its own AI chips as an alternative to Nvidia's products, though analysts say the domestic alternatives still lag behind in performance.

The scale of the investment reflects how seriously China's government views AI as a strategic priority. The $295 billion figure would make it one of the largest technology investment programs in history.

U.S. officials and technology analysts said the plan underscores the growing competition between the two countries over AI dominance. Some analysts warned that the restrictions may accelerate China's push to develop independent capabilities rather than slowing its progress.