Chinese lithography machines are being touted by China as their breakthrough tech. But their version is still far behind the west.

The United States and Japan are close to a deal to curb tech exports to China's chip industry despite alarm in Tokyo about Beijing's threat to retaliate against Japanese companies, the Financial Times reported on Tuesday citing people familiar with the matter.

China has claimed a breakthrough in a domestically developed chip making machines, marking a vital step in overcoming U.S. curbs on the country's semiconductor ambitions, Bloomberg News reported. State-linked organizations were advised to use a new laser-based immersion lithography system with a resolution of 65 nanometers ((nm)) or better,