China's Baidu In Talks With Investors To Raise Funding For In-House AI Chipmaking Firm, Reports Say

Baidu Inc has entered talks investors to raise money for its artificial intelligence (AI) semiconductor firm, sources familiar with the matter told CNBC on Monday.

The Chinese tech company is negotiating with venture capital firms GGV and IDG Capital in a bid to raise crucial funding for its AI chips, the report read.

The semiconductors would target the connected car and motor industry as a subsidiary of Baidu, it read, adding similar moves have been launched by WeChat's Tencent Holdings and Alibaba in recent years.

The news comes as China's chipmaking industry has skyrocketed in recent months, namely after the nation's State Council launched a $1.4tn initiative to decouple its economy from foreign technologies and boost mainland tech capabilities.

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The China Electronics Standardisation Institute (CESI) also proposed a standardisation initiative in late January to support the country's "healthy development of the integrated circuit (IC) industry", which will be joined by Huawei Technologies and its chipmaking wing, HiSilicon, and Shanghai-based SMIC, with public consultations concluding at the end of February.

Chinese firms were blacklisted in May 2019 after being placed on a US Entity List over alleged national security concerns, blocking access to key US technologies such as semiconductors and components. The measures prompted Beijing to invest in its domestic chipmaking capabilities in a bid to reduce dependence on US tech firms.