State trading corporation

description of stc

1. Presented by: S. Harish Kumar 33A-17(M)

2. Establishment The State Trading Corporation of India Ltd. (STC) is a premier International trading company of the Government of India engaged primarily in exports, and imports operations. It was set up in 1956 primarily with a view to undertake trade with East European Countries and to supplement the efforts of private trade and industry in developing exports from the country. The Corporation is registered as an autonomous company under the Companies Act, 1956 and functions under the administrative control of the Ministry of Commerce & Industry, Govt. of India

3. Introduction The Corporation has played a key role in the Indian economy. In the pre-liberalisation era, it acted as an arm of the Government of India not only to regulate foreign trade but also for intervention in the domestic market. The Corporation handled canalized exports and imports of large number of items varying from chemicals and drugs to bulk commodities such as edible oils, cement, sugar, newsprint, wheat, urea, etc. thereby ensuring timely availability and equitable distribution of mass consumption items as well as essential raw materials for the industry. Canalisation also helped the nation to benefit from economies of scale and keeping a close watch on the scarce foreign exchange. It undertook price support operations to ensure remunerative prices to growers for their crops such as raw jute, shellac, tobacco, rubber and vanilla as and when called upon by the Government to do so.

4. Vision: To be a world class leading organisation, continuously diversifying and delivering excellence in all areas of its operations thereby enhancing stakeholder’s value. Mission: T o consistently take advantage of upcoming business opportunities and trends with proactive enterprising spirit thereby delivering substantial year on year growth and contribute to India’s share in world trade

5. Objectives of STC: To develop core competencies in selected areas and exploit the market opportunities in these areas To continuously undertake horizontal and vertical diversifications thereby enabling sustained growth of business. To make best use of financial strength of the Corporation in expanding its business. To lay emphasis on quality of services to customers so as to develop long-term business relationship with buyers and suppliers in and outside the country. To undertake market intervention operation as and when advised by the Government of India .

6. To create new infrastructure and make optimum utilisation of infrastructure available with the Corporation. To strive to pay adequate returns to the stakeholders. To fulfil Corporation’s social responsibility by following ethical business practices and reinforcing commitment to customers, employees, partners and communities. To undertake on a continuous basis training / re-training of existing manpower and induct professionally qualified young talent so as to create a cadre of highly professional and motivated managers. To ensure an efficient and streamlined system of operations, with minimum transaction costs. To act as a facilitator to small and medium exporters and importers.

7. Present Activities The present business handled by STC can broadly be classified into three categories viz. I mport of items like edible oils, pulses and fertilizers on behalf of the Govt. of India . B usiness carried out on behalf of business associates on back-to-back basis and Direct buying and selling in items like tea, soyabean seed, chana , etc . Imports on behalf of the Govt. are arranged by STC through floating of global tender and imported quantities are either handed over to the agency (such as FCI, Department of Fertilizers) nominated by the Govt. or sold in the domestic market through tenders. In the case of back-to-back business, the terms of trade are finalized in consultation with the business associate and STC charges a fixed trade margin in the range of 1 to 1.5%.

8. T oday STC undertakes exports/imports of a diverse range of items to/from countries all over the world. Its export basket includes wheat, rice, tea, coffee, cashew, extractions, castor oil/seed, sugar, spices, jute goods, iron ore, chemicals, pharmaceuticals, light engineering goods, construction materials, consumer goods, processed foods, textiles, garments, jewellery, leatherware , etc. The Corporation also monitors counter trade commitments against Government purchases. Major items of import by STC include gold, silver, edible oils, sugar, pulses, fertilizers, metals, minerals, ores, hydro-carbons, petro-chemicals and raw materials for the Indian industry. It also undertakes import of technical and scientific equipment on behalf of Forensic Science Laboratories, State Police and Intelligence Departments and Paramilitary Organisations, etc.

9. Corporate Office of STC Jawahar Vyapar Bhawan , Tolstoy Marg, New Delhi –110001 (India)

10. Organisational Structure The Board of Directors of STC comprises of whole time Chairman-cum-Managing Director, five whole-time Directors(three Marketing, one Finance and one Personnel), two ex-officio Directors from Ministry of Commerce and independent Directors appointed by the Govt. from time to time.  The Corporate office of the Corporation at New Delhi is organised into a number of trading and services groups. These groups are headed by Chief Managers/General Managers who in turn report to their respective Chief General Managers/Directors. STC has thirteen branch offices in India, the major ones being at Mumbai, Kolkata, Chennai, Ahmedabad, Bangalore and Hyderabad. STC has own tank farms, warehouses, godowns at various locations of the country for storage of liquid/dry cargo. STC has a wholly owned subsidiary, namely, STCL Ltd., which is based at Bangalore and is engaged in spices trading/ auctions organisational web.pdf

11. India’s Foreign Trade MERCHANDISE TRADE ( Rs . Crore) EXPORTS (including re-­exports) FEBRUARY APRIL - ­FEBRUARY 2015­-16 142246.46 1562819.14 2016-17 164269.71 1648743.26 % Growth 2016-­17/ 2015­-16 15.48 5.50 IMPORTS 2015-­16 187100.79 2307259.36 2016­-17 % Growth 2016-­17/ 2015-­16 19.67 -0.77 TRADE BALANCE 2015­-16 ‐44854.33 ‐744440.22 2016­-17 ‐59672.35 ‐640855.22

12. SERVICES TRADE EXPORTS & IMPORTS (SERVICES): ( Rs . Crore ) (Provisional) January 2016­-17 EXPORTS (Receipts) 92385.10 IMPORTS (Payments) 57248.81 TRADE BALANCE 35136.29 Source: RBI Press Release dated 15 th March,2017

13. Top countries of India’s export and import: top countries.pdf Annual report: Annual report.pdf

14. Awards & Rankings of STC 14th rank in terms of net sales among 206 PSUs as per Public Enterprises Survey : 2009-10 39th rank in terms of net sales among Top 500 Companies by Financial Express (Feb’2012). 32nd rank in terms of net sales among Top 1000 Companies by Business Standard (Mar’2012 ). Won first prize under the category of agencies supplying gold to export against replenishment during 2009-10 from Gems & Jewellery Export Promotion Council in October’2010 . Won award for Gentle Giant Miniratna – I (Largest Non-Manufacturing Company) Awards2011 Won Greentech HR Excellence Award 2010 from Greentech Foundation, New Delhi for outstanding achievement in innovation in employee retention strategies. Won Asia’s Best Employer Brand Award 2010 for Talent Management at Singapore.

15. STC at a Glance NAME The State Trading Corporation of India Ltd. (STC) INCORPORATION 18 th  May, 1956 under Indian Companies Act, 1956 PHONE [phone] WEBSITE www.stclimited.co.in PRINCIPAL ACTIVITIES International Trading ADMINISTRATIVE MINISTRY Ministry of Commerce and Industry Government of India PRESENT STATUS 1. Schedule ‘A’ Central Public Sector Enterprise of the Govt. of India 2. A Mini-Ratna Category-I Company 3. Recognised by the Govt. of India as a Four Star Export House LISTING National Stock Exchange Bombay Stock Exchange

16. BRANCHES In addition to its Corporate Office at New Delhi, STC has twelve  branch offices  in India, covering all important trading centres including port towns. MANPOWER (AS ON 31.03.2017) Managers  464 Staff         207 Total         671 EQUITY (AS ON 31.03.2017) 60 Crore (US$ 9.25 Million)  RESERVES (AS ON 31.03.2017) 831.25 Crore (US$ 128.25 Million) TURNOVER (2016-17) 7,752 Crore (US$ 1196.29 Million) Subsidiary Company STCL Ltd. (Formerly Spices Trading Corporation Ltd.) is a fully owned subsidiary of STC.

17. Limitations of the STC: There are certain inherent weaknesses of the STC, pointed out in a study conducted by Indian Institute of Management, Ahmedabad were: Though the objectives of the STC were quite clear and well defined but it has not taken any major entrepreneurial decision of its own so far. There seems to be no guidelines for the choice of new products to be exported and new markets to sell its products. Not much expertise has been developed to locate and develop sources of supply for exportable products and also for procuring imports from sources of supply abroad. Much of the expertise is in operation as an agent, in processing indents and tenders and transportation and distribution not in merchandising, procurement and marketing. The set back in the exports of non-canalized items can be attributed to the STC’s failure to develop an appropriate supply base and take adequate promotional step among importers.

18. Conclusion: On the whole, the STC has developed a sound infrastructure for development of exports through it about 13 branches in India and 18 overseas offices and a large force of trained marketing personnel. Foreign offices provide market intelligence and can pursue the STC business matters with the various parties concerned. With this sound infrastructure, STC should not only act as a casualising agency but should also make efforts to create an image of an effective trading house on lines of Japanese trading houses. It should provide new dimensions and leadership as the biggest export house in the country. It has stepped forward towards achieving its objectives of boosting exports.