Economy

Italy u-turn on marines: Economic diplomacy may have played a role

Our Bureau New Delhi | Updated on March 24, 2013 Published on March 24, 2013

Italy is among India’s top five trading partners in the EU and the 12th largest investor in India.

In the end it was probably economic diplomacy that worked in Italy agreeing to send back the two marines accused of killing two Indian fishermen.

That India is likely to be among the largest economies globally soon and assurances by India were among the factors which saw a u-turn in the Italian Government’s earlier stance.

This was the impression of some former diplomats that the Business Line spoke to on what prompted the Italian Government to send back the marines within the deadline set by the Supreme Court for their return.

“Relations between India and Italy are important. Let us not forget that Italy is an important member of several global bodies like G7, G8 and G20 apart from the European Union and has a say in these bodies.

“But at the same time now no country can ignore India’s strong fundamentals. Given the slowdown in Europe, the Italians probably felt that it was better to return the marines especially as India had given assurances to the Italian Government,” former Foreign Secretary Kanwar Sibal said.

An economic think-tank, Centre for Economics and Business Research in a report on ‘World Economic League Table’ has indicated that India will become the fifth largest economy by 2020 while a recent report on ‘Wealth Report 2012’ by Knight Frank & Citi Private Bank estimates that India will become the world’s largest economy by 2050.

India has also indicated that it will be investing close to $1 trillion in developing infrastructure which is an area which may be of interest to Italy.

Former Cabinet Secretary and former Ambassador to the United States, Naresh Chandra, however, feels that it was not only economics which had a role to play in the entire episode but also the fact that there has been a change of Government there after the recent elections.

“Italy is not down on its knees; its GDP is more than India’s GDP at present,” Chandra pointed out. However, the fact that Italy is among India’s top five trading partners in the EU and the 12th largest investor in India is well documented.

In 2010-11, bilateral trade between the two countries stood at €7.21 billion registering an increase of 28 per cent from the previous year and in 2011-12, it was €8.52 billion at an increase of 18 per cent over the previous year.

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Published on March 24, 2013
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