Xiaomi has set up a $1.45 billion fund to invest in Chinese semiconductor products and technologies in a bid to offset sanctions from the U.S. and other nations.

Led by CEO Lei Jun, the business mogul who heads up both the Chinese consumer electronics giant and software company Kingsoft, the unnamed fund will have private and public sector investors, according to The Wall Street Journal.

Xiaomi is funding one-third of the total and Kingsoft is providing around $72.3 million in backing. Other investors include entities backed by both the Beijing and Tianjin governments. Lei will serve as chair of the fund’s investment decision committee.

The fund will look to invest in companies developing semiconductor technologies related to AI, smart manufacturing and automotive electronics.

China’s semiconductor sector has been subject to sanctions for several years, including restrictions on its access to chip manufacturing tech. Last October, the Biden administration imposed strict export rules on AI-focused semiconductors and related equipment to China.

The U.S. argued that it was to prevent China from selling products containing AI chips to Russia and other sanctioned nations. However, China has argued that the sanctions were aimed at preventing it from competing in a semiconductor market where other nations, including the U.S., Japan, the EU and Korea, are seeking to dethrone Taiwan.

Just last month, Japan and the Netherlands followed the U.S.’s lead and agreed to limit sales of advanced chip-making equipment to China.