<type name="Magento\Framework\Setup\Declaration\Schema\Declaration\ReaderComposite">
    <arguments>
        <argument name="readers" xsi:type="array">
            <item name="xml" xsi:type="object">
                Magento\Framework\Setup\Declaration\Schema\FileSystem\XmlReader
            </item>
        </argument>
    </arguments>
</type>

This is a type configuration.

This configuration is the application level configuration (`app/etc/di.xml`) fo the object manager. It is not a part of a specific module, but will apply to all sub-applications in Magento 2 (cart, admin, api, cron, etc).

This configuration tells the Object Manager that when a user wants a Magento\Framework\Setup\Declaration\Schema\Declaration\ReaderComposite object that the following arguments should be used in the foo object's constructor.

• $readers = [...items...];