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PRESENTATION BY: Kirti Patidar. Ruchi Ajmera. Ranu Sharma.

State trading is often associated with canalisation. Canalisation means establishment of state monopoly in foreign trade. In other words, an item that is canalised can be imported or exported, as the case may be, only by the designated state trading agency. Canalizing agency is the term used by a number of developing countries to describe the STEs they maintain. The term refers to the channeling, or canalizing, of imports and/or exports through a designated productspecific enterprise. Such STEs aim to provide some degree of price stabilization, particularly for producers, as well as to ensure availability of supplies for domestic consumers.

Import Canalisation

an instrument of state intervention in international trade that has been used for over three decades, channelling or canalizing imports has played an important role in many countries' economies. Developing countries, in particular, faced with serious problems regarding balance of payment, have resorted to import canalization on a large scale. partial or voluntary canalization is feasible alternatives to function efficiently


These agency are appointed by the government i.e. canalizing of import refer to buying goods from various sources of buy in STC with various considered behind it

PURPOSE :::::::::

control import of high value items and hazardous item . Political reason . Foreign exchange . Maintain national security . Availability of resources .

Advantages :::::::

TO THE OVERSEAS BUYER STC act as an expert guide for buyers , interested in indian goods for them . STC finds the best indian manufacturer , undertakes negotiations fixes delivery shedules, overseas quality control all the way to the final shipment to the entire satisfaction of the buyer.


indian manufaturers whose product sail the seus via STC .benefit a lot from its expertice ,STC helps thousand of indian manufaturer to find market for their products . STC assist the manufaturer to use the best raw material , guides and helps them manufatuere product that will attract buyers abroad .

IMPORT OF CANALISATION & CURRENT STATUS 1 Import and distribution in planned & phased manner. 2 Long term supply arrangements . 3 Self generation of foreign exchange though special link arrangement. 4 Equitable distribution in india through consortion.


1 2 3 4 5 6 financial assistance to exporters on easy terms. Taking products of small scale manufacturer to international trade fairs & exhibition . Import of machinery and raw material for export production . assistance in the areas of marketing , technical knowlegy , quality control packaging. supply of imported goods in small quantities as per convenience of buyers . Market intervention on behalf of the government .

List of Items which are Canalised

HS code/Exim Code Item Description Policy Condition Relating to the policy Sub Heading Description


Other than seed quality Other


Import through Food Corporation of India. Import through State Trading Corporation and Hindustan Vegetable Oils Corporation

Wheat and meslin



Soya beans, whether or not broken


Ammonium sulphonitrate


Import through Minerals and Metals Trading Corporation of India Limited.

Mineral or chemical fertilisers, nitrogenous Industrial Monocarboxyl ic fatty acids; acid oils from refining; industrial fatty alcohols


Palm Stearin excluding crude palm stearin


Import through State Trading Corporation of India Limited.


RBD Palm Stearin Canalised

Import through State Trading Corporation of India Limited and Hindustan Vegetable Oil

Industrial Monocarboxyl ic fatty acids;

Canalization of export
Canalization of foreign trade means routing of import or export of certain specified commodities through the designated state trading enterprises such as; Tribal cooperative marketing federation of India (TRIFED). National agricultural cooperative marketing federation or India (NAFED). Minerals and metals trading corporation of India (MMTC).

the canalization agencies undertake various promotional programmed and provide incentives and assistance to the supporting manufacturers. however, during the post-liberation era the number of canalized items have been drastically reduced and canalization is confined to certain petroleum products ,fertilizers, edible oils and few other items

Objectives of the canalization of exports

1. To avoid the problems of under invoicing. 2. To increase the export volume. 3. To generate excess profit which can be used for exports incentives and promotional purposes. 4. To increase the bargaining power of Indians exports. 5. To fetch optimum price for exports. 6. To safeguard the interest of small exports.

Impact of canalization
Analyzing the impact of canalization, the ministry of commerce remarked: the effect of canalization of import through state agencies has resulted in savings in foreign exchange on imports on account of bulk purchases and also on account of bulk shipments and in supply of row materials to consumers in the country at reasonable rates.

The other advantages are stated to be:

1. Import and distribution in a planned and phased manner; 2. Long term supply arrangements; 3. Self generation of foreign exchange through special link arrangements; 4.Equitable distribution in India through association or consortia. however, views of the trade and industry on canalization are not favorable.


Items List: 6 entries and 17 sub-entries, export of which is permitted through designated canalizing agencies, following the amendments to the EXIM policy announced on 31st March'95. Prior to this amendment there were 6 entries and 18 subentries in this category Canalized Items (Exports) Following the amendments to the EXIM policy announced on 31 March 1995, this category now consists of six enteries and 17 sub-eateries

Petroleum products Gum karaya Mica waste Mineral ores , concentrates and compounds thereof Rare earths (including Yttrium) ores, concentrates and compounds thereof Other mineral containing the following substances as accesory ingredients including : Samerskite Uraniferous allanite Radium ores and concentrates Thorium ores and concentrates Titanium ores and concentrates (ilemnite, rutile, lou cexene etc.)

Granular sillimanite produced by Indian Rare Earths Ltd. and Kerala Minerals and Metals Ltd. Iron Ore. However export of the following types of iron ore are not canalised Iron ore of Goa origin when exported to China, Europe, Japan South Korea and Taiwan. Chrome or lumps with Chromium Oxide not exceeding 38% Low silica friable/fine ore All grades of bauxite, Manganese ores Niger seeds Onions

Spices Trading Corporation

STCL Ltd. was initially established in 1982 as Cardamom Trading Corporation Ltd., a Government of India undertaking under the Ministry of Commerce & Industry. Realizing the immense market potential, the company developed from a solely cardamom trading corporation to become Spices Trading Corporation Ltd. in 1987. STCL became a wholly owned subsidiary of The State Trading Corporation of India Ltd., A Government of India Undertaking in 1999. Spices Trading Corporation Ltd. was renamed as STCL Ltd. STCL is involved in import, export and domestic trading of a


Trading in domestic and international markets of spices and other agricultural commodities To process and manufacture spice and agricultural products of international standards To support, protect, maintain, increase and promote production of Indian spices and other agricultural commodities as well as their sale / export To effectively participate with Government of India as one of their strategic partners in Agro-based programmes. To conduct open auctions and sell agricultural commodities as auctioneer To undertake and promote Research and Development With the diversified trade outlook, to trade in non-agricultural products like Industrial Goods, Equipments, Components. To carry on domestic and international trade in Iron Ore, Bullion, Precious Metals, Limestones, Metcoke, Minerals, polymer, Polyester Yarn, cotton Yarn, PVC Resins, HMS Scarps and other metal Scraps


Quartered in Bangalore, STCL Ltd. also has a wide presence across the country, with branch offices at strategic locations to facilitate effective trading activities. The branch offices are located in cities such as Delhi, Kolkata, Chennai, Mumbai, Cochin, Sakleshpur, Madikeri, Visakhapatinam. Goa, Kumily and Bodinayakanur.


STCL Ltd. is involved in a range of activities, right from sourcing and trading of quality products to making initiatives in market expansions. Through strategic associations with other premier organizations, STCL extends a helping hand to the farmers and growers who are a valuable link in the supply chain. Some of the activities initiated by STCL are: Exports Imports Domestic Trade Cardamom Auctions Canalysing Agency Online trading

Quality checks

With open economies, consumers world over are becoming more and more quality conscious and quality requirements are becoming more and more stringent. At STCL, commitment to high quality products is a tradition. The tradition is to maintain not just the best but legendary quality in its products. STCL is today renowned world over for being a premier trading company that adheres to high quality standards. All the dispatches are checked for quality at the load ports and discharge ports by independent and internationally reputed quality audit organizations

Market reach

Ltd. offers a varied and diverse range of products for consumers across the globe. STCL is reputed in the global market as a reliable buyer and supplier of quality products and superior service. The company has established a vast portfolio of clientele in India as well as other parts of the globe, including countries like China, Japan, Europe, USA, Middle East, Singapore, Malaysia, Srilanka and Bangladesh

Corporate vision

the diversified trade outlook, the company would grow from strength to strength in a sustained manner : To contribute to the overall well being of farmers by providing necessary support, including better sales realization and low cost financial assistance for their produce. To provide quality products to consumers by meeting the international food safety standards. .