Elon Musk is a shrewd businessman. He knew China is vulnerable now facing massive sanctions from the US. The timing is perfect for him to get what he wants from China.
Tesla's FSD is way ahead of its Chinese peers. This permission will help Tesla pull ahead of its competitions in China and help its struggling stock prices. However, longer term, it will not serve him well as China/US fights intensifies and Chinese EV makers copycat Musk's FSD technologies.