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NEWS IN CHINA

• China’s AI Race Heats Up as Shanghai Launches a Massive Subsidy Scheme: Shanghai has announced a 1 billion yuan (US$139 million) subsidy program to fasten the development of its artificial intelligence industry and compete with other major Chinese cities. This initiative is aimed at reducing the operational costs for AI start-ups and promoting widespread adoption of AI solutions. The funding for this includes 600 million yuan for subsidizing the computing power, 300 million yuan for discounts on third-party AI models, and 100 million yuan for data acquisition. The additional funding will support the companies in renting, purchasing, or building the computing infrastructure and AI resources, where the rates range from 10% to 100% of the contract value. In order to attract talent and research institutions, Shanghai would provide up to 500 million yuan in subsidies to new AI research facilities, along with housing and talent incentives. This initiative was unveiled at the World Artificial Intelligence Conference (WAIC), where China also released an action plan for global AI governance. This move comes after rising international competition, which follows the U.S. unveiling its own AI Action Plan earlier this month. 
  
  
• Heavy Rainfall Continues Across North China as Regions Intensify Emergency Response and Disaster Relief: Heavy rainfall has continued across multiple regions in North China, which has resulted in widespread emergency rescue and disaster relief efforts. The Central Meteorological Observatory issued an orange warning for heavy rain, while Beijing raised its alert level to red after receiving a maximum rainfall of 290.5 mm in areas like Miyun and Pinggu. Beijing authorities have relocated over 30,000 residents with a lot of water discharge from the Miyun Reservoir. Armed police had successfully evacuated 100 trapped villagers in the Huairou District, and the power and communication infrastructure, which had been affected, has been partially restored, with 162 communication base stations being reopened and electricity restored to nearly 15,000 households. The National Disaster Prevention, Mitigation and Relief Commission initiated a level-four emergency response and allocated 50 million yuan to support recovery efforts. Over 5,600 evacuated in Tianjin's Jizhou District after 200+ mm of rainfall triggered tourist site closures and rising Haihe River Basin water levels. Typhoon Zhuza is expected to hit between Zhejiang and Jiangsu in the next two days amid continued heavy rains in North, Northeast China, and Inner Mongolia.
  
  
• China Urged to Control Narrative and Engage Asia to Counteract the West: Chinese scholars and policy advisors are calling for greater efforts to reshape China’s global image and counterbalance the dominance of Western narratives. Some experts argue that China must take the lead in crafting an inclusive “Asian narrative” by engaging with scholars and refining its global communication strategy. A political scientist, Zheng Yongnian, emphasized the need for China to develop its knowledge system and take a proactive role in shaping international norms in fields like artificial intelligence. An expert from Peking University noted that China’s hard power has grown a lot, but its cultural soft power still lags and limits its influence on the global stage. It is suggested to improve communication capacity and use cultural exports like tech, video games, and animated films to reshape China’s international image.  Chen Jin from the Central Party School warned that China risks marginalization in international narratives, which includes being excluded from the Global South. Some experts have also highlighted China’s opportunity to shift from a rule follower to a rule maker in global governance, especially in tech. With a few international standards in emerging areas like AI and quantum communication, they argue that China should lead in setting norms through involvement from research institutes and private tech firms.
  
  
• China Showcases J-20 Operations Through Tsushima Strait Amid Ongoing PLA Modernization: China’s most advanced stealth fighter, the J-20,  recently flew through the Tsushima Strait, a waterway between Japan and South Korea, linking the Sea of Japan and the East China Sea. The move was revealed in a CCTV broadcast showcasing missions by the First Fighter Brigade, which included patrols over the Bashi Channel, Tsushima Strait, and areas surrounding Taiwan. While the footage did not name the aircraft, the J-20's presence was unmistakable. Neither Japan nor South Korea, both of which monitor the strait closely with advanced radar systems, reported the flight, which makes the passage notable for its stealth and unacknowledged transit. China is estimated to operate around 400 J-20s by the end of 2025, marking it as the largest stealth fighter fleet globally and surpassing even the U.S. in numbers. The J-20 features advanced stealth, long-range PL-15 missiles, and modern radar systems, with production continuing at an estimated 120 units annually. The CCTV segment emphasized ongoing PLA modernization and air combat integration ahead of the PLA’s 98th anniversary on August 1st, framing the J-20’s presence in the Tsushima Strait as a demonstration of enhanced operational capabilities. 
  
  
• China Urges South Korea to take ‘Independent Tack’ in Foreign Policy: In the first official call with the newly appointed South Korean Foreign Minister Cho Hyun, Chinese Foreign Minister Wang Yi urged South Korea to pursue an independent, stable, and pragmatic approach to foreign policy, emphasizing the opposition to “decoupling” and disruption of supply chains. The 45-minute call was focused on resetting bilateral ties under South Korea’s new president Lee Jae-myung, who took office on June 4th following the fall of the former president Yoon Suk-yeol, who is known for his pro-US stance. Foreign Minister Wang has called for avoiding third-party influence by referring to the US-Japan-South Korea alliance and encouraged a deeper economic and diplomatic cooperation. Wang and Cho reaffirmed their commitment to the China-South Korea strategic cooperative partnership and expressed hopes that the upcoming APEC summit in Gyeongju (Oct 31st - Nov 1) would mark a turning point in the bilateral relations. Xi Jinping is expected to attend. President Donald Trump has been invited but has yet to confirm attendance, while Wang Yi accepted an invitation to visit South Korea and congratulated Cho on his new appointment; both sides emphasized mutual benefit and cooperation, although North Korea was not present at the meetings. The outreach reflects China’s strategic interest in improving ties with Seoul amid the ongoing US-China rivalry, especially as Beijing seeks to stabilize the supply chains and regional alignment. 

SOCIAL MEDIA CHATTER

Chinese Authorities Tighten Scrutiny on Influencer Marketing and Health Claims: In a sign of intensifying regulatory oversight of online commerce, Chinese internet celebrity, “Chai Duidui” (real name Chai Xiangqian) and his liquor company, Wenxhous Chai’s Wine Co., Ltd., have been fined 6,000 yuan by the Pingyang County Market Supervision Administration for false advertising. This penalty was issued after the company falsely claimed in a Douyin video that its liquor product was 20 years old and claimed it had therapeutic properties such as treating cancer and high blood pressure. The authorities determined the content violated advertising regulations by promoting disease treatment functions that are not permitted outside the medical field. This marks Chai’s second penalty in recent weeks, a tea company he operates was fined 220,000 yuan on July 22 for similar misleading claims. The Cyberspace Administration of China also listed “Chai Duidui” in its July 2 campaign against online misinformation, citing the blogger for fabricating claims and smearing businesses to attract traffic and boost sales. Social media users have reacted sharply, with many mocking Chai Duidui’s exaggerated health claims and calling for stricter penalties on deceptive influencers. Others see the crackdown as overdue, pointing to the growing mistrust of livestream e-commerce tactics.

INDIA WATCH

India Reclaims Strategic Ground in Maldives as China Pulls Back, Says SCMP: Chinese news outlet South China Morning Post reported that the Indian Prime Minister Narendra Modi’s recent visit to the Maldives marks a strategic shift in the bilateral ties, and reinforces India’s regional presence as China appears to scale back its investment commitments.. The trip, which coincided with the Maldives' 60th Independence Day celebrations, was Modi’s first since President Mohamed Muizzu came to power on an “India Out” platform in 2023. During the two-day visit, Modi pledged a US$565 million credit line, eased the repayment terms on an earlier loan, and launched free-trade talks. The author states that India also gifted 72 heavy vehicles to the Maldivian defence ministry and announced new infrastructure and digital payment initiatives. Analysts comment that the economic distress at home and fading Chinese enthusiasm have driven Muizzu’s pivot towards cooperation. SCMP noted that while China has grown cautious over Maldives' financial instability despite investing $1.4B, India has stepped up with aid, defence ties, and diplomacy, culminating in Modi’s landmark visit. Experts note that while the Maldives is likely to maintain ties with multiple powers, India’s sustained outreach has re-established its position as Male’s closest partner.

Prepared By

Shreya Parthiban

I am Shreya Parthiban, a 3rd year undergraduate student pursuing International Relations and Economics at Sai University, Chennai. I am currently working as a Research Intern at the Organisation for Research on China and Asia. I have previously interned at The Peninsula Foundation, The Prajnya Trust, and The Impact and Policy Research Institute (IMPRI), as Research Interns in the field of International Relations and Policy making. My interests mainly include Global Politics, Foreign Affairs, Policymaking, Sustainability, Climate Change, and International Relations in general. I look forward to working in the field of research in China and Asia and plan to pursue a career in policy research and international development in the future.