China said on Monday that it welcomes the India-Middle East-Europe Economic Corridor announced on the sidelines of the G20 summit so long it doesn't become a "geopolitical tool", even as it downplayed Italy's plan to pull out of its Belt and Road Initiative (BRI).

China welcomes all initiatives that truly help developing countries build infrastructure and sincere efforts to promote connectivity and common development, the Chinese Foreign Ministry said.

"At the same time, we advocate that various connectivity initiatives should be open, inclusive, and form synergy, and should not become geopolitical tools," the ministry said in a written response to news agency PTI to a question on China's reaction to the new corridor.

On Saturday, Prime Minister Narendra Modi announced plans to launch the India-Middle East-Europe Economic Corridor which includes India, the UAE, Saudi Arabia, the European Union, France, Italy, Germany and the US.

"Today we all have reached an important and historic partnership. In the coming times, it will be a major medium of economic integration between India, West Asia and Europe," PM Modi said. 

The corridor will give a new direction to connectivity and sustainable development of the entire world, he said.

"This is a big deal. This is a real big deal," US President Joe Biden said while announcing the pact, aimed at promoting clean energy and better communities. 

"As we work to address infrastructure gaps across low- and middle-income countries, we need to maximise the impacts of our investments," he said.

Analysts say the new corridor is the first global connectivity project to rival China's Belt and Road Initiative (BRI) which drew criticism for its debt sustainability, especially from smaller countries.

The ambitious multi-billion-dollar BRI launched by Chinese President Xi Jinping in 2013 envisions connecting China with Southeast Asia, Central Asia, the Gulf region, Africa and Europe with a network of land and sea routes rebuilding the old Silk Road trade route.

But with the decade-old BRI running into billions of dollars of investment, China faces a major challenge as Italy has announced its plans to quit the initiative, which according to the Italian Foreign Minister, Antonio Tajani, "did not bring the results we expected" and many Italian parties were against Italy's participation.

Italy's decision comes at a time when China announced plans to hold the third conference of BRI in Beijing next month.

If Italy pulls out, it will be regarded as an embarrassment for President Xi's pet project.

BRI reportedly figured in the talks between Chinese Premier Li Qiang and his Italian counterpart Giorgia Meloni on the sidelines of the G20 summit in New Delhi on Saturday.

Asked whether the BRI issue figured in the Li-Meloni talks, Chinese Foreign Ministry spokesperson Mao Ning told a media briefing in Beijing that both leaders had exchanged views on important issues in bilateral relations and agreed to strengthen dialogue and cooperation in joint pursuit of prosperity and development.

On the BRI, she said, "Ten years since the Belt and Road Initiative was put forward, more than 150 countries and cooperation partners in a wide range of areas have joined the initiative, which has delivered tangible benefits to the people of participating countries".

"It serves the interests of all partner countries to further tap into its potential for cooperation," she said.

Skirting a direct response on BRI, she said China and Italy are both ancient civilizations on either end of the ancient Silk Road.

"We can further deepen practical cooperation in various fields and work for further growth of our comprehensive strategic partnership," she said.

(Except for the headline, this story has not been edited by NDTV staff and is published from a syndicated feed.)