Instrument of agreement -- Italy has refusal rejected (9)
I believe the answer is:
accordion
'instrument' is the definition.
(accordion is a kind of instrument)
'agreement italy has refusal rejected' is the wordplay.
'agreement' becomes 'accord' ('accord' can be a synonym of 'agreement'**).
'italy' becomes 'i'.
'has' is a charade indicator (letters next to each other).
'refusal' becomes 'no'.
'rejected' is a reversal indicator.
'no' in reverse letter order is 'on'.
'accord'+'i'+'on'='ACCORDION'
'of' acts as a link.
(Other definitions for accordion that I've seen before include "squeeze it while operating keys" , "Squeeze box" , "Cad I croon about a musical instrument" , "Agreement starts the musical instrument" , "Squeeze-box" .)