India-Italy Relations: Strengthening Ties Across Trade, Culture, and Security

To prepare for INTERNATIONAL RELATIONS for any competitive exam, aspirants have to know BILATERAL RELATIONS WITH DEVELOPED COUNTRIES. Here we will study about India-Italy Relations. It gives an idea of all the important topics for the IAS Exam and the Governance syllabus (GS-II.). India-Italy Relations terms are important from Governance perspectives in the UPSC exam. IAS aspirants should thoroughly understand their meaning and application, as questions can be asked from this static portion of the IAS Syllabus in both the UPSC Prelims and the UPSC Mains exams. Even these topics are also highly linked with current affairs. Almost every question asked from them is related to current events. So, apart from standard textbooks, you should rely on newspapers and news analyses as well for these sections.

India-Italy Relations: Basic and Backgrounds 

• India and Italy are ancient civilizations but young states (Italy having been reunified only in 1861), shaping the dynamics of India-Italy Relations.
• The classical languages, Sanskrit and Latin both belong to the Indo-European language family.
• People of these two ancient civilizations have known, interacted and traded with each other for over 2000 years. Italian port cities were important trading posts on the spice route.
• The Venetian merchant Marco Polo, during his travels to the east, also traveled to India in the 13th century and wrote about his experiences.
• Indian troops, serving with the British Indian Army, were active in Italy during World War II. These included the Rajputana Rifles and Gurkha Rifles.
• The 10th Indian Division took part in the East African Allied campaign against the Italians in Somaliland and Abyssinia.

Political India-Italy Relations

• India-Italy relations were established in 1947 politically.
• The two countries enjoy cordial relationships.
• There has been a regular exchange of visits at political and official levels between both countries.

Economic India-Italy Relations

• Amongst EU member-states, Italy is India’s 5th largest trading partner (following Germany, Belgium, UK and France).
• Indian exports to Italy are driven by petrochemical, plastic, textile and steel. Italian exports towards India amount to 1% of Indian total import, shaping the dynamics of India-Italy Relations.
• Italy is the 27th global supplier to India, while is the 10th market of destination of Indian exports.
• Italy’s presence in India accounts for slightly less than $3 billion investment cumulatively between April 2000 and June 2018. Those investments are mostly in the automotive industry, trading, services, industrial machinery and food processing.
• Main items of Indian exports to Italy are ready-made garments, leather, iron ore, motor vehicles, textiles, chemicals, gems & jewelry. Main items of import from Italy are general and special purpose machinery, machine tools, metallurgical products, and engineering items. Around 140 large Italian companies are active in India.

India-Italy Relations of Trade

• The Indian-EU free trade agreement has seen bumpy rides in this
• There have been many rounds of negotiations but nothing significant has come out. With Italian support now, this FTA is expected to be a little easier to have breakthroughs as it is good to have support from one of the major EU countries.
• The trade between India and Italy is not quite encouraging. The annual turnover is about 8 billion US dollars in favor of India of about 1 billion US dollars. Though it is in India’s favor, there is a great potential for increasing the trade between India and Italy.

Strengthening India-Italy Relations: Indian Diaspora in Italy

• Italy hosts the third largest Indian community in the European Union, plays a crucial role in the fabric of India-Italy Relations, with an estimated 1,80,000 people, after the UK and the Netherlands.
• As first generation migrants, the majority of them are engaged in economic sectors such as agriculture, dairy farming, leather industry, construction works and in service industry.
• A significant proportion of the Indian diaspora is concentrated in the northern Italy regions like Lombardia, Piemonte, Veneto and Emilia Romagna regions, Central Italy like Florence, Rome and Southern Italy like Campania, Puglia and Calabria.

India-Italy Relations: Cultural Ties

• India-Italy Relations agreement for cultural cooperation was signed in 1976.
• It includes the Cultural Exchange Programme (CEP) between Italy and India which entails exchange of students in language programmes as well as other academic courses.
• There are around 10 Universities/higher education institutions in Italy with highly qualified faculties which conduct courses in Indian art, history and languages.

Advancing Collaboration: India-Italy Relations in Science and Technology

• An Agreement on S&T shaping India-Italy Relations has existed since 1978.
• The Agreement envisages three yearly action plans under which a maximum of thirty joint research projects can be undertaken.
• Some of the prime areas of joint research are Electronics, Biotechnology, Design Engineering Automotive Technologies, Energy, etc.

Strengthening Defense Ties: India-Italy Relations in Defence

• The Joint Defence Committee was established in 2018 to enhance and encourage a “structured dialogue” between Indian and Italian defense firms.
• Italy supported India’s “intensified engagement” with nuclear, missile and dual-use technology and substances-export control regimes like the Wassenaar Arrangement, the Australia Group, and the Nuclear Suppliers’ Group (NSG) which strengthen global non-proliferation efforts.

India-Italy Relations and Joint Efforts Against Terrorism

• Italy has supported India in the anti-terrorism front, emphasizing the shared concerns in India-Italy Relations. India has for a very long time globally asked the world to be more proactive and be strict against terrorist organizations especially organizations like the JeM which are based in Pakistan and are responsible for cross terrorism.
• Support by Italy in this matter strengthens India’s hands in its global fight against terrorism especially when it comes to Pakistan. Today, terrorism has become a global issue and is not restricted to India only. Acknowledgment of terrorist organizations such as Al Qaeda and ISIS calls upon countries to not give safe haven to the terrorist entities.
• India is facing terrorist attacks whereas Italy faces an influx of refugees from Syria, Yemen, Libya along with other countries in Europe. Thus, there is a rising security concern for Italy also and it is significant when such an area is openly discussed.
• Italy feels that this concern of cross border terrorism was raised by India for a long time and now it is being realized as a reality.
• Horrific terrorist incidents happening in Europe makes one feel that maybe Europe is now a little more sensitive to a country like India in matters of anti-terrorism.

Strategic Foundations of India-Italy Relations

• Strong manufacturing base – Italy is the eighth largest economy in the world and the third largest in the Eurozone after Germany and France with a GDP of $1.86 trillion. It is also the world’s sixth largest manufacturing nation, dominated by small and medium enterprises clustered in many industrial districts.
• Brexit – Half of the stock of Indian investments in the EU is actually in the UK. Indian investors are therefore looking for alternative entry points to access the EU market. Italy represents a perfect opportunity for that.
• The geopolitical dynamics between India and Europe – India has tried to open its policy towards Europe, Europe has become more inward looking following Brexit and the rise of the far right parties throughout the region. So India is looking to build a bridge to the EU.
• G20 – Italy and India will be holding the consecutive Presidencies (Italy in 2021 and India in 2022) of the G20, one of the world’s main fora for global governance.
• Fight against climate change – Italy will co-host the 26th session of the Conference of the Parties, COP26, in 2021, together with the United Kingdom, and India is one of the world’s major responsible stakeholders.
• Africa – Both India and Italy are stepping up their engagement in the continent, with the aim of managing migration flow for Italy and fostering developing cooperation for India.

India-Italy Relations: Challenges

• Lower trade – India and Italy have been trade partners since the Roman era, and so it is unfortunate that India has such a low volume of trade and investment.
• The Enrica Lexie Case – Where two Indian fishermen were killed by Italian marines in 2012, the event was a big mistake, this tragic fact quickly became politicized.
• Italy’s current political instability – Italy is in a very precarious position – with a nationalist, naturalist near fascist on one side and a populist movement on the other.
• Italy is the ‘Achilles heel of Europe Having one of the lowest growth rates at 1.5% with high youth unemployment at 30% and increasing debt at a worrying 133% of its GDP.

India-Italy Relations: Way Forward

• Both countries should shape the international discourse around priorities that both countries hold dear:

1. 1. from taking advantage of our economic complementarity to strengthening our partnership based on shared values
   2. on our thriving creating industries
   3. scientific knowledge and technological prowess
   4. from the development of a rules-based international system to the promotion of just trade
   5. inclusive growth and the realization of the 2030 Agenda.

• India-Italy Relations can get better by supporting an effective multilateral system, which would be the best political accelerator to win our battle against the novel coronavirus and to promote a sustainable, equitable and durable recovery.
• Improving trade: the potential of India and Italy as trade partners can be further explored if India and the European Union (EU) sign the Bilateral Trade and Investment Agreement (BTIA) which has been in negotiation for over 11 years without conclusion.
• Improving relations between EU and India By the recently adopted EU Strategy for Connectivity in Asia.

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