In a surprising move, India’s IT minister has given a thumbs-up to Chinese AI lab DeepSeek, signaling plans to host its large language models on local servers. This marks a rare opening for Chinese tech in India, which has previously blocked apps like TikTok and WeChat over security concerns.

“DeepSeek’s work is impressive—building a powerful model with just $5.5 million,” said IT Minister Ashwini Vaishnaw on Thursday. He clarified that hosting the platform in India comes with strict conditions, including storing all user data within the country to meet privacy regulations.

This announcement comes as India ramps up its own AI efforts. A new AI Compute Facility, equipped with over 18,000 GPUs, is set to launch soon. Nearly 10,000 GPUs are ready to go, promising a boost to AI research and development. The facility will also offer computing services at significant discounts—up to 47% off for high-precision tasks.

The decision to host DeepSeek follows a week of controversy. The app was recently removed from app stores in Italy over data privacy questions. Meanwhile, DeepSeek’s new “reasoning” model has sparked debates about copyright and U.S. export controls, while also shaking up the tech industry.

But India isn’t just opening doors to foreign AI. The country is pushing hard to develop its own AI models. “Major chip designers are eager to work with India on creating local GPUs,” Vaishnaw noted. He also revealed plans for a $30 billion investment in hyperscalers and data centers over the next few years, with Reliance leading the charge on what could become the world’s largest data center.

To oversee these efforts, India will establish a regulatory body using a “hub-and-spoke” model, encouraging collaboration on AI safety frameworks. “Our focus is on open, application-driven models,” Vaishnaw added, highlighting 18 AI projects already selected for funding, spanning areas like agriculture and climate change.

This bold step into AI collaboration marks a new chapter for India’s tech landscape, blending global partnerships with homegrown innovation.