BRI: PM Meloni meets Chinese Premier Li Qiang on the sidelines of the G20 summit and shares his plan to exit BRI. China announced the BRI in 2013.
China’s ambitious Belt and Road Initiative (BRI) is going to suffer a major setback. Italy has made preparations to exit this project. During the two-day G20 meeting held in New Delhi, the Prime Ministers of China and Italy spoke about this.
Let us know what has happened regarding BRI. What is China’s Belt and Road Project? What is the reason for Italy’s withdrawal from this project? Has any country separated from this before?
What has happened regarding BRI?
Italian media in its recent reports said that PM Meloni met Chinese Premier Li Qiang on the sidelines of the G20 summit and shared his plan to exit the BRI. At a press conference on the final day of the G-20 summit, Meloni talked about his conversation with the head of the Chinese government. “We had a pleasant and helpful discussion on how to strengthen our bilateral relationship, Maloney said. I’m going to stick to my promise to go to China.
Apart from this, the Italian Prime Minister said that it is pertinent to mention that Italy was the only G-7 country to sign for BRI. He assured that leaving the Silk Road (BRI) would not compromise relations, but a decision is yet to be taken.
Earlier, the ‘Corriere Della Sera’ newspaper had written that Prime Minister Meloni has informed his counterpart of his intention to withdraw from the strategic project for Beijing. However, Li Qiang made one last attempt to persuade the Italian authorities to reconsider.
What is a BRI project after all?
The BRI is based on the old Silk Road, which was a global trade and infrastructure plan. It connected China with Western countries. BRI is a major initiative of Chinese President Xi Jinping. BRI was proposed by Jinping in 2013. According to the Green Finance and Development Centre, the number of countries joining BRI by signing a Memorandum of Understanding (MoU) with China in April 2023 is 148. Along with this, BRI is also working with 18 countries of the European Union and nine countries of G20.
What is its purpose?
Through a network of land and maritime connections, it seeks to connect Southeast Asia, Central Asia, the Gulf area, Africa, and Europe. According to China, the objective of this agreement is to facilitate the development of transit transport, logistics, transport network security, and related infrastructure. Apart from this it also promotes cross-border projects including railways, roads, civil aviation, power grid, information, and communications.
So why is Italy falling apart now?
Italy is the only major Western country in the BRI project. However, now he is regretting his decision. Italy is expected to exit the project by December. Italy’s Defense Minister Guido Crosetto said on Sunday that joining the BRI four years ago was a hasty and harmful decision, we can come out soon.
Italy had signed the agreement to join the BRI in 2019 during the previous government. According to Crosetto, the decision to join the new Silk Route was an immediate and unprofitable act. This increased China’s exports to Italy manifold, while Italy’s exports to China were not significantly affected. Now the issue is how to exit BRI without spoiling relations with China, which is also a partner.
Has any country separated from this before?
Australia walked away from the project in 2021. The then Australian PM Scott Morrison had canceled China’s BRI agreement. The agreement was then voided using the foreign-veto provision made under Commonwealth laws. Apart from this, the African country Djibouti wants to get rid of it because China had deployed an army in the name of security in the ongoing project in the African country. Sensing this trickery, some African countries may withdraw from BRI.
At the same time, Indonesia has had to pay a heavy price for joining BRI. It is being forced to extend the concession period for the high-speed railway project being built in Java province by 80 years. According to a report, due to delays in construction work, the cost of the project increased by almost 40 percent. Due to this, the Indonesian government had to pay approximately $470 million from its treasury. Questions were raised regarding this from many quarters in the country.
Why was the BRI project under suspicion?
Chinese President Xi Jinping announced the BRI in 2013. It is understood that China’s objective behind this project is to create infrastructure to deliver the products made in its country to the world and to increase China’s influence in the world. But now questions are being raised in many countries regarding the problems arising in the project. Renegotiations over loan terms in at least 40 BRI agreements began in 2020 and 2021.
According to a joint study by the World Bank, America’s Harvard Kennedy School, Aidata, and the Kiel Institute for the World Economy, from 2008 to 2021, China has spent $240 billion on giving debt bailouts to 22 countries. There has been a significant increase in this amount in recent years. The reason for this is the increasing problems in repaying the loan related to BRI.
Controversial terms are a big reason
Many of the terms of the BRI agreement are considered controversial, but China has decided them according to its interests. According to America’s Georgetown University, there are many conditions such that countries taking loans from China cannot even publicly disclose that they have taken a loan.