I'm open to considering the argument that banning exports of a thing creates a market incentive for the people impacted by the ban to build aa better and cheaper thing themselves, but I don't think it's as black and white as you say.
If the only ingredient needed to support massive innovation and cost cutting is banning exports, wouldn't we have tons of examples of that happening already - like in Russia or Korea or Cuba? Additionally, even if the sale of NVIDIA H100s weren't banned in China, doesn't China already have a massive incentive to throw resources behind creating competitive chips?
I actually don't really like export bans, generally, and certainly not long-term ones. But I think you (and many other people in the public) are overstating the direct connection between banning exports of a thing and the affected country generating a competing or better product quickly.