The phrasing "chips that are banned in the country" seems completely inaccurate. These are chips that the US does not allow to be exported to China. We do not have the power to ban anything in China, that's up to the Chinese government.
Didn't China ban two processors for like 140 companies? It wouldn't be unlike China to ban modern Nvidia chipsets from Alibaba and similar while allowing Deepseek to do what they want. To win at both advancing domestic semiconductor development and also AI.