How China is shaking the world, from AI DeepSeek to sixth-gen fighters

In 1957, the Soviet Union shocked the United States and the world by successfully launching Sputnik, the first Earth-orbiting satellite. It came to be known as the "Sputnik moment" as it dawned upon the US that the Soviets had better scientists and engineers than they did. A similar 'Sputnik moment' is at play now. This time it is China that has shaken up the global landscape with groundbreaking advancements in fighter jets and artificial intelligence (AI).

Last month, China sprung a surprise by unveiling a sixth-generation stealth fighter aircraft, challenging America's longstanding aerial dominance. Weeks later, the Asian giant sent shockwaves through the US tech industry and financial markets with its low-cost AI chatbot DeepSeek - developed by a one-year-old startup.

China's rapid developments in both military and technological spheres has not gone unnoticed by the new US President, with Trump saying it should serve as a "significant wake-up call" for American businesses.

CHINA'S DEEPSEEK TAKES US AI BIGWIGS BY SURPRISE

But why are investors and US tech giants in panic mode over DeepSeek? The reason is that DeepSeek has been built at a fraction of the cost required for established models like OpenAI's ChatGPT. The AI app took only $6 million to develop, much less than the billions spent by top US companies like OpenAI, Google or Meta.

Despite the low development cost, its performance is on par with industry-leading AI models. It has already become the most-downloaded app in Apple's US app store since its launch earlier this month and has surpassed ChatGPT in countries like the UK, Australia, Canada, China and Singapore.

DeepSeek's paid subscription is also more affordable at $0.50 per month, as compared to ChatGPT, whose model starts at $20 per month.

The fact that China developed such a cutting-edge AI model despite US curbs on the sale of advanced chips to the country, has sent ripples through global markets.

On Monday, Nvidia, which became the world's most valuable company last year, lost $589 billion in its market value. It was the largest one-day loss for any company on the US stock market. Not only the US, AI and semiconductor-related stocks were also affected across Asia and Europe.

The development comes at a time when Trump has made AI his priority and has promised to fund billions of dollars to develop its infrastructure. In fact, the new US President has already announced $500 billion for an AI initiative called 'Stargate'.

CHINA STEALS A MARCH ON FIGHTER JETS

With China seemingly rocking the AI boat with DeepSeek, it caught the world off guard last month when it clandestinely tested two sixth-generation fighter jets - taking a significant leap in the arms race. Apart from AI-enhanced automation, the jets have greater payload and fly longer than the ones operational now.

In comparison, the US is likely to see its first sixth-generation fighters enter service only in the 2030s. On the other hand, India's fifth-generation jet is still at the design and development stage.

In fact, since Trump won the US polls last November, China has launched one of the world's largest amphibious warships apart from unveiling a new airborne intelligence and command platform. The string of developments are being seen as China's posturing against a possible tariff threat by the new Trump administration.

While it remains to be seen if China's groundbreaking advancements in modern warfare and AI heralds a shift in the global power balance, it has no doubt challenged the West's dominance in these fields.