US reinstates Alibaba, BYD and Baidu on military blacklist over alleged Chinese military links

The United States has reinstated Chinese technology and electric-vehicle giants Alibaba, BYD and Baidu on a Pentagon blacklist of companies deemed to have links to China's military, underscoring Washington's continued focus on national security concerns despite recent efforts by the world's two largest economies to stabilise ties.

The US Department of Defense updated its roster of Chinese military companies operating directly or indirectly in the United States, restoring the three firms to the so-called Section 1260H list after their brief and unexplained removal earlier this year.

The move places renewed scrutiny on some of China's most prominent corporate champions and signals that strategic competition between Washington and Beijing remains firmly intact even as both sides pursue diplomatic engagement.

Pentagon cites military-civil fusion concerns

In its updated filing, the Pentagon said Alibaba, China's e-commerce and cloud computing giant, contributes to Beijing's military-civil fusion strategy through affiliations with the Ministry of Industry and Information Technology (MIIT) and indirect ties to state-owned entities.

More from Business

China's military-civil fusion programme encourages the integration of civilian technological capabilities into military development, a policy that US officials argue blurs the line between commercial and defence activities.

The Defense Department similarly cited links between BYD, the world's largest electric-vehicle maker, and Chinese state entities. Baidu, one of China's leading artificial intelligence and internet companies, was also restored to the list.

The Pentagon's updated roster includes several other major Chinese firms, including Tencent, Huawei, CATL, DJI, China Mobile, China Telecom and Hikvision.

Reversal of February withdrawal

Alibaba, BYD and Baidu were initially added to the blacklist in February. However, the updated list was withdrawn less than an hour after publication, prompting speculation among analysts that the administration sought to avoid escalating tensions with Beijing ahead of US President Donald Trump's visit to China in May.

The latest decision effectively restores the original February designations and reaffirms Washington's concerns about the relationship between China's private-sector champions and the country's defence establishment.

The revised list also reinstates Chinese memory chipmakers CXMT and YMTC, which had briefly been removed from the earlier version.

Limited immediate impact, broader implications

While inclusion on the Pentagon's military companies list does not automatically trigger sanctions or investment bans, it carries significant reputational consequences and serves as a warning to investors, suppliers and government agencies.

The designation can also act as a precursor to more restrictive measures, including export controls, procurement restrictions or future sanctions.

Companies reject allegations

Alibaba, BYD and Baidu have previously denied any military affiliations and rejected the basis for their inclusion on the Pentagon's list.

When first designated in February, the companies said they operate as commercial enterprises and do not support Chinese military activities.

The Chinese embassy in Washington did not immediately comment on the latest action.

The blacklist update comes just a month after Trump and Chinese President Xi Jinping met in Beijing and pledged to work towards what both sides described as a "constructive relationship of strategic stability". However, the Pentagon's decision underscores that national security concerns remain a central feature of the increasingly complex US-China relationship.