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Cabinet to take up national textile policy

After reforms in foreign direct investment (FDI) regime, the government is likely to take up a more measures to boost the labour-intensive textile industry. The Cabinet is also likely to take up the National Textiles Policy-2016. In the works since last year, the policy aims to achieve $300-billion exports by 2024-25. India exported $36.25 billion worth of textile and related goods in the last financial year, a drop of 2.4 per cent from 2014-15. Competing nations Bangladesh and China have been blamed for aggressively edging out Indian exporters from traditional markets like Europe. The high price of domestic cotton, coupled with heavy duties on import of cheaper Chinese varieties, also hampered production of cotton goods, said an expert. Cotton-based readymade goods, among the highest foreign exchange earners, fell two per cent; cotton fabrics fell more than four per cent. The new policy also aims to create 35 million jobs by 2024-25. "The policy rests hugely on job creation as we have set a target of doubling the total number of people currently employed in the sector," a ministry source said on conditions of anonymity.

The Cabinet might also soon take up a review of the India-Korea Free Trade Agreement. The government is currently reviewing the trade agreement with South Korea and is expected to update it soon. India's CEPA with South Korea was implemented in January 2010 to liberalise trade norms. Bilateral trade, estimated at $16.58 billion in 2015-16, is heavily in favour of South Korea. India's exports to South Korea fell nearly 23 per cent in 2015-16 to $3.54 billion. Indian companies have sought a review of trade agreements with other nations that they claim have benefitted the country's trading partners more.