Italy's exit from China's Belt & Road Initiative. Why India should be happy | Mint
Active Stocks
Tue Feb 27 2024 12:08:42
  1. State Bank Of India share price
  2. 753.50 -0.72%
  1. Tata Steel share price
  2. 143.10 0.35%
  1. Sun Pharmaceutical Industries share price
  2. 1,560.25 0.21%
  1. Power Grid Corporation Of India share price
  2. 291.00 1.13%
  1. Tata Consultancy Services share price
  2. 4,075.15 1.87%
Business News/ News / World/  Italy's exit from China's Belt & Road Initiative. Why India should be happy
BackBack

Italy's exit from China's Belt & Road Initiative. Why India should be happy

Italy's decision to exit the Belt and Road Initiative seems to be influenced by the changing geo-political considerations and the project's limited impact on its economy

Italy PM Giorgia Melony and India PM Narendra Modi on the sidelines of COP-28 Summit in DubaiPremium
Italy PM Giorgia Melony and India PM Narendra Modi on the sidelines of COP-28 Summit in Dubai

Four years after becoming the only G7 nation to join China's ambitious Belt and Road initiative (BRI), Italy has decided to leave the project. Prime Minister Giorgia Meloni-led government has communicated its decision to Beijing, in what is seen as another indication by far-right leaders to maintain distance from China. The development comes as the recent EU-China summit didn't go very well for the relationship dynamics with European leaders expressing their concerns about the policies of President Xi Jinping.

Also Read: Italy withdraws from Belt and Road Initiative of China

Italy's decision to exit the Belt and Road Initiative seems to be influenced by the changing geo-political considerations and the limited impact of the project on Italy's economy. PM Giorgia Meloni was against the decision since Day 1 as she accused the previous government of joining BRI just to buy Beijing's political influence.

Changing priorities of Europe

Professor Harsh V. Pant, Vice President of Studies and Foreign Policy at Observer Research Foundation calls it a "real crisis for China" as he underscored the trust deficit between China and the Western world today. Professor Pant argued that the move displays the changing priorities of Europe where the countries want to deal with China on their own terms.

“Italy's decision to exit BRI certainly shows a complete collapse of political trust between Europe and China. Italy used to have one of the most sympathetic attitudes towards China and now we are seeing a dramatic turnaround in the views and I think that underscores the challenge China faces in Europe today where apart from a few margins, the trust between the Western world and China is collapsing very rapidly," Professor Pant said.

“The move displays the changing priorities of Europe and as we have seen, the West today engages with China on its own terms. The summit between US President Joe Biden and Xi Jinping and the EU-China Summit underscores the reality that the West is no longer ready to budge on critical issues," he added.

The expert mentioned China's failed strategy to create a divide between Europe and the US and its difficulties in dealing with them amid an economic crisis.

“China, for a change, tried really hard first to create a divide between Europe and the US, but as the move didn't succeed it is trying to now see how far it can work with Europe with its slow economy. It is a real crisis for China's policy towards the West, although the BRI has many takers in other parts of the world," Pant said.

Balance tilt towards China

In terms of numbers, the BRI has been far from a game-changer for Italy's economy as the growth in exports remained limited. As per the reports, Italy's exports to China increased from 14.5 billion euros to 18.5 billion euros after joining BRI, but the numbers are much better for China as its exports to Italy grew from 33.5 billion euros to 50.9 billion euros.

However, experts continue to emphasise that Italy's decision to withdraw from the mega infrastructure project is a political one that symbolises China's position in the current geopolitical order.

“I would say that it's a nation's own strategic choices which govern their decisions. The same is the case with Italy. Any such decision is a political move. How much political it is in terms of catering it to domestic politics of Italy is yet to be fully assessed," Dr Martand Jha, Doctoral Fellow at Russian and Central Asian Studies, School of International Studies, Jawaharlal Nehru University said.

Why India should be happy 

The move to discontinue the BRI comes as India and Italy are visibly growing their engagements at the highest levels. India will be happy with Italy's decision to exit the BRI as the ambitious Chinese project passes through the Pakistan-occupied Kashmir and New Delhi has objected to the project since its beginning. 

The development coincides with India's good relations with Italy which is also reflected in numbers. In the fiscal year 2021-22, India witnessed a surge in its bilateral trade, reaching a substantial sum of $13.2 billion, indicating a growth rate exceeding 50% compared to the preceding financial period.

Although it is too early to say, Italy's decision to exit the project displays the caution they are exercising with China and as seen with the wider Western world, India gets an advantage of this caution as it serves as a growing, reliable partner in Asia.

  

 

Unlock a world of Benefits! From insightful newsletters to real-time stock tracking, breaking news and a personalized newsfeed – it's all here, just a click away! Login Now!

ABOUT THE AUTHOR
Devesh Kumar
I cover politics, geo-politics, economy, and technology and have keen interest in understanding and analyzing the complex issues that shape our world. I am committed to delivering well-researched, balanced, and thought-provoking stories that provides insights into the key trends and developments.
Catch all the Business News, Market News, Breaking News Events and Latest News Updates on Live Mint. Check all the latest action on Budget 2024 here. Download The Mint News App to get Daily Market Updates.
More Less
Published: 08 Dec 2023, 07:11 PM IST
Next Story footLogo
Recommended For You
Switch to the Mint app for fast and personalized news - Get App