Italy Targets Becoming India’s Third-Largest EU Trade Partner

December 3, 2024

India and Italy have initiated a new “Cotton Route” initiative, which aims to enhance trade relations alongside the historic Silk Route. The initiative was announced by Italy’s Business Minister, Adolfo Urso, in Mumbai. Urso expressed aspirations for Italy to become India’s third-largest trade partner in the EU.

Defence Spending Increase

Italy plans to raise its defence budget to $29 billion, which focuses on cybersecurity, tanks, submarines, and space projects. A budget of €7.5 billion is allocated until 2026. Urso believes India can assist Italy in achieving its defence and space objectives. Both nations have existing agreements between their space agencies.

Made in Italy 2030 Plan

Italy is launching the “Made in Italy 2030” industrial plan, which aims to expand traditional sectors such as food, fashion, and textiles. New focus areas include pharmaceuticals, aerospace, marine industries, and high-tech defence. Urso sees substantial collaboration opportunities with India in these sectors.

Urso’s visit follows a strategic action plan signed by the Indian and Italian prime ministers at the G20 summit. He envisions India as a gateway for Italian firms to access Asian markets. Conversely, Italy will serve as a hub for Indian companies targeting Europe.

Trade Growth Goals

Last year, trade between India and Italy reached $14 billion. Italy aims to become India’s fourth-largest EU trade partner by 2030. Improving logistics and port infrastructure is crucial for this growth. Fostering industrial partnerships will also play role.

Current collaborations include Indian investments in Italy’s iron and steel industry. Italian investments are also flowing into Indian machine tools and agriculture. Future opportunities are expected in space exploration and marine industries.

Important Facts for Exams:
Cotton Route: The Cotton Route initiative aims to enhance trade ties between India and Italy. It complements the historic Silk Route, promoting collaboration in various sectors.
Made in Italy 2030: This industrial plan focuses on expanding Italy’s traditional sectors. New areas include pharmaceuticals and aerospace, with collaboration opportunities identified with India.
Blue Economy: The blue economy refers to sustainable use of ocean resources. It encompasses marine industries and aims to balance economic growth with environmental sustainability.

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