An attempt by Meta Platforms to acquire Manus, an artificial intelligence start-up, and its subsequent blocking by Chinese authorities, marks more than a routine regulatory intervention. It signals a deeper shift in how states are exercising power over global technology flows, not merely to regulate markets, but to shape them in alignment with strategic and political priorities.
Taken in isolation, China’s move is consistent with its long-standing emphasis on digital sovereignty. When viewed alongside recent US actions against TikTok, however, a more concerning pattern begins to emerge: the gradual side-lining of rule-based processes in favour of discretionary state power.
Tight control
For years, China has maintained a tightly controlled technology ecosystem, justified on grounds of national security, data governance, and political stability. The reported Manus decision fits within this broader framework. What makes the current moment distinct, however, is not China’s behaviour alone, but the convergence of approaches across geopolitical rivals that once claimed fundamentally different philosophies of governance.
The US, historically a champion of open markets and a rules-based order, offered an instructive example in its posture towards TikTok, owned by ByteDance. The effort to compel divestiture of TikTok’s US operations, under the threat of a ban, was framed as a national security imperative. While such concerns may be valid, the process extended beyond established mechanisms such as the Committee on Foreign Investment in the United States (CFIUS), combining executive pressure and legislative intervention in ways that raised questions about transparency and procedural consistency. When legal frameworks appear to be stretched or supplemented in this manner, the predictability they are meant to provide weakens.
It is within this evolving context that China’s actions must be understood. When one major power normalises interventionist behaviour under broad and sometimes opaque justifications, it lowers the threshold for others to follow. The result is the emergence of a global environment in which legal principles risk becoming secondary to strategic imperatives. The implications are far-reaching. At its core, the rule of law provides predictability, fairness, and accountability. It assures investors that decisions will be governed by transparent criteria rather than shifting political considerations. It enables firms to plan cross-border investments with confidence that regulatory processes will remain consistent. When state action begins to appear selective or contingent, that assurance weakens.
The effects are already visible. Global technology firms increasingly operate in fragmented regulatory environments, where compliance involves not only adherence to formal rules but also anticipation of political sensitivities. Capital flows become more cautious, and innovation ecosystems risk becoming siloed. Smaller firms, lacking the capacity to navigate such uncertainty, are disproportionately affected.
This is not to suggest that economic decision-making can be insulated from geopolitical considerations. It rarely has been. The more relevant question is whether strategic interests are pursued through mechanisms that offer transparency, consistency, and recourse, or through ad hoc exercises of power that leave affected parties with limited avenues of challenge.
Institutional frameworks do exist. CFIUS, despite its limitations, provides a structured review process.
For India, the erosion of predictable regulatory norms presents a complex challenge. Balancing openness with strategic caution becomes more difficult in an environment where major powers themselves appear to be redefining the boundaries of acceptable intervention. The Manus episode may fade quickly from public attention. The broader trend it reflects will not.
The writer is Distinguished Fellow at the Avinyum Foundation and former Managing Director of CGI India
Published on May 6, 2026