Italy has become the first G7 country to join China’s Belt & Road Initiative (previously known as One Belt One Road (OBOR) Initiative).
Belt & Road Initiative
Belt & Road Initiative (BRI) is an ambitious project that focuses on connectivity and cooperation among multiple countries spread across the continents of Asia, Africa, and Europe. BRI spans about 150 countries (China’s Claim).
Initially announced in the year 2013, the project involves building networks of roadways, railways, maritime ports, power grids, oil and gas pipelines, and associated infrastructure projects.
The project covers two parts.
Silk Road Economic Belt: It is land-based and is expected to connect China with Central Asia, Eastern Europe, and Western Europe.
21st Century Maritime Silk Road: It is sea-based and is expected to connect China’s southern coast to the Mediterranean, Africa, South-East Asia, and Central Asia.
Significance of BRI For China
The Belt and Road Initiative (BRI) is the most emblematic of China’s economic and industrial might, as of its ambitions for global, political and strategic influence.
As infrastructure spending at home became less sustainable, China has shifted the emphasis to boost the global competitiveness of domestic businesses.
The large infrastructure investments in the least developed and developing countries have enabled China to leverage its influence around the world, potentially altering the established rules of the global order and challenging western powers.
BRI will strengthen China’s presence in the Eurasian region and puts it in a commanding position over Asia’s heartland.
Western critics have attacked the initiative as new colonialism, or Marshal Plan for the 21st century.
BRI is also being seen as a part of China’s debt trap policy, wherein China intentionally extends excessive credit to another country with the intention of extracting economic or political concessions from the debtor country.
Significance of Italy joining
Italy’s endorsement of the BRI is a potential game changer as it is one of the major economies in the world.
Other major economies may follow Italy’s lead in joining BRI.
India has not joined because
China Pakistan Economic Corridor (CPEC) is one of the flagship projects of BRI which is seen by India as infringing its sovereignty.
China is building roads and infrastructure in the disputed territory of Gilgit-Baltistan, which is under Pakistan’s control but which India claims as a part of Jammu and Kashmir.
If the CPEC project gets implemented successfully, this would hamper India’s strategic interests in the South Asian region. It will serve Beijing's strategic ambition to encircle India.
CPEC can aid Pakistan’s legitimacy in the Kashmir dispute.
China’s increasing footprints in the South Asian region is detrimental to India’s strategic hold e.g. construction of the Hambantota Port in Sri Lanka provided China critical strategic location in the Indian Ocean.
The Group of Seven is a group consisting of Canada, France, Germany, Italy, Japan, the United Kingdom, and the United States.
These countries, with the seven largest International Monetary Fund (IMF)-described advanced economies in the world, represent 58% of the global net wealth.