ASSISTANCE (M D A)
STATE TRADING CENTERS
The government of India established the
Market Development Fund (now known as
Marketing Development Assistance ) in
1963, with a view to stimulate and diversify
the export trade along with the
development of marketing of India
products and commodities abroad
PURPOSES OF MDA
Marketing research , commodity research , area survey
Export publicity and dissemination of information.
Participation in trade fairs and exhibitions.
Trade delegates and study teams.
Establishment of offices and branches in country and
Grant in aid to export promotion councils and other
approved organizations for the development of exports
and promotion of foreign trade.
Any other schemes that are intended for the
development of exports
MDA IS PROVIDED FOR:-
1.PRODUCT OR PROMOTION AND COMMODITY
This provision under this head is for CCS(cash
compensatory support) ,for selected export products
like engineering, chemicals, alloyed products. plastic
goods, jute products, processed food items leather
and leather goods..
2.GRANT IN AID TO EXPORT DEVELOPMENT
AND MARKET DEVELOPMENT ORGANIZATIONS.
There are 19 export promotional councils to whom
the grant in aid is being provided. how ever no grant
is given to apparel export promotional councils and
cotton textiles export promotion councils , but the
foreign exchange needed for such export
promotional activities are released through these
3.EXPORT CREDIT DEVELOPMENT
This scheme is for subsidies to be paid
for the interest charges on export finance
provided by banks. This scheme is administered
Other incentives &
2.Technology and capital goods
3.Relaxation of MRTP Act.
4.Trade fairs and exhibitions
5.Buyer seller meets
9.Foreign exchange facilities.
13.Quality control and pre-shipment inspection.
State trading refers to export and import of goods by
In centralized economies, the entire foreign trade is
conducted directly by the government.
In free enterprise countries, export and import is
entrusted to government departments.
In a mixed economy, state participation in foreign
trade is mostly done through government
departments or government trading organizations.
Scope of State trading is different in different
The state may establish monopoly by restricting the
There is partial monopoly when private participation
is limited to selected no. of items.
There is sole state monopoly when state control is
extended over the whole trade and private
participation is completely forbidden by the state.
Objectives of state
1.It improves terms of trade.
2.Regulating imports and exports
3.Source of revenue.
4.It affords protection.
State trading in India
State trading started in the year 1948 with the
abnormal increase in the price of East African cotton
of which India was a bulk importer.
In 1956 the government started State Trading
Corporation of India.
It was done partly because, importers to whom the
licenses were given created artificial scarcity.
FUNCTIONS OF STC
1. To organize and undertake trade with state trading
countries as well as other countries in commodities
entrusted to the company for any such purpose by
the union government from time to time and to
undertake the purchase sale and transport of any
such commodities in India or anywhere else in the
2. to undertake at the instance of the union
government import and or internal distribution of any
commodities in short supply with a view to
establishing prices and rationalizing distribution.
3.to generally implement such special arrangements
for imports exports internal trade and or distribution
of particular commodities as the union government
may specify in the public interest.
SUBSIDIARIES OF STC
1. Minerals and Metal Trading Corporation
2.Project and Equipment Corporation of India.
3.Export Credit Guarantee Corporation of India.
4.Spices Trading Corporation limited.
MINERALS AND METAL TRADING
Established in 1963.
Important agency in export of ores , minerals and
It penetrated Indian export market in Japan, Korea ,
Singapore eastern Europe and other overseas
It is India’s largest international trading company and
the first public sector undertaking to be awarded ‘the
Golden Super Star’ status in the country
PROJECT & EQUIPMENT
CORPORATION OF INDIA
It came into existence in 21st
In may 1990 it became an independent corporation
under ministry of commerce.
It deals with export of textiles , machinery , project
equipment , transportation equipment etc.
It takes effort in securing small and medium term
industrial projects to overcome problems in credit
EXPORT CREDIT GURANTEE
CORPORATION OF INDIA LTD
It was known as Export Risk Insurance Corporation
Ltd estb.in 1957.
Later it changed the name due to increased
1. A range of insurance covers to the Indian
exporters against the risk of export proceeds due to
commercial and political causes.
2. Guarantees to banks to provide loans to exporters
in liberal terms.
Earlier known as Cardamom Trading Corporation
Estbd. In 1982.
It started functioning in new name on 1987.
It became subsidiary of STC in 1999.
Its main objective was to carry out domestic and
international trade in spices and related products.
There are various assistance provided by the
government for export promotion and developing
State trading houses are generally governments
agency for carrying out both domestic and
It has a no. of subsidiaries.
INTERNATIONAL TRADE AND FINANCIAL
INTERNATIONAL BUSINESS- FRANCIS