The WIPO report says that China holds over 60 per cent of global AI patent applications and about two-thirds of robot-related patent applications. Further, by the end of 2025, the number of high value invention patents in China reached 2.292 million of which 70 per cent are in strategic emerging industries. Further China’s GPU related patent applications increased over ten fold over five years.

The U.S. is still the leading country with high tech capability and its AI applications are leading to high growth in big industries, though it has also generated turmoil leading to rationalization of work force and even layoffs. The US was much ahead of China in the year 2021 in AI applications but in the last five years, China has bridged the gap very fast. The more important aspect is that China has developed the same AI application technology at a far more cheaper cost ensuring sustainability of the operations.

Trump advisers thought of using this AI tech supremacy in getting more concessions from China at the coming Beijing summit on May 14-15. China is allowing supply of its critical minerals to US following the last meeting, but it has to be renewed and that depends on a package deal linked to US high tech technology to China in some key areas. This was expected to be a part of the full scale trade deal which both the leaders are scheduled to conclude at the Beijing summit.

China has nearly closed its gap to the U.S. in AI bot performance, while continuing to best global competition in number of patents, publications, and rollout of robots, according to the Stanford University Institute for Human-Centered Artificial Intelligence (HAI) 2026 AI Index report released recently.

The report found a shrinking gap in Arena scores—a metric indicating relative performances of large language models—between the top AI bots in the U.S. and China. In May 2023, the U.S.’s top model, OpenAI’s GPT-4, led with more than 1,300 Arena points compared with China’s fewer than 1,000. By March 2026, that gulf shrank to just 39 Arena points, with the top U.S. model, Anthropic’s Claude Opus 4.6, leading China’s Dola-Seed 2.0 by just 2.7%.

While the U.S. still beats China in the number of top AI models—50 compared with 30—China has more publication citations than the U.S., accounting for 20.6% of AI citations in 2024 compared with the U.S.’s 12.6%. China also has nearly nine times the volume of industrial robot installations, leading the world with more than 295,000, compared with the U.S.’s 34,200.

Trump very recently had a long meeting with the leading high tech honchos of USA and discussed the nature of competition with China. It was revealed that the US honchos were apprehensive of the Chinese companies capability in inventing the same technology at far cheaper costs and beating the US in the global market. It was also pointed out that huge investments in AI related projects have been made by the big U.S. companies, but if the returns are not commensurate, some of the companies may go bust. Some of the U.S. experts even talk of the dotcom bust in 1999 and 2000 which led to the closure of many start ups.

According to the Stanford report, “For years, the U.S. outpaced all other global regions on AI—in model size, performance, artificial intelligence research, citations, and more,” said Stanford’s summary of the report. “But China emerged as an AI counterweight to the U.S., gradually gaining ground, and this year it appears to have nearly erased any U.S. lead.”

Despite fewer investment dollars and wider regulatory constraints, China has changed the narrative of its ability to compete against the U.S. in a broader tech war. Spurred by its 2025 “DeepSeek moment,” China has poured funding into AI startups, with IPOs in Hong Kong last quarter reaching a five-year high of $110 billion across 40 new listings.

China has also quietly invested in its electricity infrastructure, adding more electricity demand than the entire consumption of Germany every year, David Fishman, a China energy analyst with the Lantau Group, previously said in an interview with Fortune. The country’s reserve margin has never dipped below 80%, Fishman said, essentially giving it twice the necessary capacity to grow AI compute.

American private investment in AI still far exceeds China’s, reaching $285.9 billion in 2025, more than 23 times China’s $12.4 billion. The U.S. funded 1,953 new AI companies last year, more than 10 times any other country, the Stanford report noted. But the most important finding of the Stanford report is that the US is losing AI talent and that happened more faster in Trump’s present tenure due to the turmoil over immigration.

AI’s momentum swing in China’s favour may be contributing to a slowdown in tech talent entering the U.S. The Stanford report found the number of AI scholars moving to the U.S. dropped 89% since 2017, and that decline is happening precipitously, accelerating 80% in the past year alone. At this juncture, more researchers are still entering the U.S. than leaving it.

Stanford report findings are being seriously assessed at the level of Trump advisers and emergency steps are being planned to retain AI talent and to encourage more such talent to enter the US. While the Iran war is going on, the second most important priority for the White House is preparations for the Beijing visit by Trump and how to improve the U.S. President’s bargaining position in his talks with the Chinese supremo Xi Jinping. In the next two weeks, this exercise will be intensified. (IPA Service)