The Partnership for Global Infrastructure and Investment (PGII), a concerted effort to finance infrastructure projects in underdeveloped countries, has been formally established by the G7 nations, who are gathering during the present Leaders’ Summit in Germany. Launched on June 27, the initiative is viewed as the bloc’s response to China’s “Belt and Road Initiative.”
The infrastructure plan was initially unveiled in June 2021 during the G7 Summit held in the UK the previous year. President of the United States Joe Biden referred to it back then as the Build Back Better World (B3W) framework. It did not indicate much progress, though, and there were no clear indications of the plan’s duration or financing source.
The project was this time formally introduced as PGII.
In essence, the G7 nations—the US, Canada, Italy, the UK, France, Germany, and Japan—as well as the EU have taken note of the global infrastructure projects being conducted and sponsored by China and chosen to provide their alternative system for it.
The PGII and the BRI both have the explicit goal of assisting nations in obtaining money for the construction of essential infrastructure, like as roads, ports, bridges, communication systems, etc., in order to promote international commerce and cooperation.
The G7 asserts that their programme is transparent, aimed at creating infrastructure that is resistant to climate change, and will support the advancement of gender equality and health infrastructure development goals.
The fund, according to the US president, is for loans rather than “charity or help,” and will benefit both the nations making the loans and the ones receiving them.
According to a statement from the White House, the US International Development Finance Corporation, the nation’s development bank, will invest up to $30 million in the Omnivore Agritech and Climate Sustainability Fund 3, a fund that “invests in entrepreneurs building the future of agriculture, food systems, climate, and the rural economy.”
The fund will make investments in businesses that “raise the profitability and agricultural productivity of smallholder farms, as well as boost food security and promote both climate resilience and climate adaptation in India.”
In addition to India, projects have been announced in West Africa, South America, and Southeast Asia.
The Belt and Road Initiative was launched by China in 2013 by President Xi Jinping. It intends to recreate the historic commercial routes that formerly connected Rome in Europe to East Asia and crossed into China.
Under this programme, the Chinese government assisted in lending money to foreign nations for infrastructure projects, and in many cases, Chinese businesses were given the contracts to do the job. This aided China in leaving its imprint on the world stage.
However, China has come under fire in the West and from a few other nations for giving unsustainable debts to nations that won’t be able to pay them back.
While the US has criticised BRI, other G7 nations have reacted to it differently. In 2019, Italy became the first G7 country to join the BRI, and in the same year, British Finance Minister Philip Hammond referred to the initiative as a “vision” even though it is not formally a part of the BRI.
While not directly involved in the BRI, Germany and France have collaborated with China to create rail networks and other connectivity-related initiatives.
Disclaimer – We have collected this information from various trustworthy sources on the Internet, and the facts have been checked manually and verified by our In House team.
