G/STR/Q1/IND/22  
 
 
  
17 June 2021 
(21-4960) Page: 1/4 
Working Party on State Trading Enterprises  Original:  English  
 
  
STATE  TRADING  
REPLIES TO QUESTIONS1 FROM THE UNITED STATES  REGARDING  
INDIA'S NEW AND FULL NOTIFICATION S2  
The following communication, dated and received on  9 June 2021 , is being circulated at the request 
of the delegation of India. 
 
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Question 1  
The United States notes that India 's Foreign Trade Policy (FTP) for 2015 -2020 
(https://dgft.gov.in/sites/default/files/ft17 -051217.pdf  and specifically, APPENDIX -2J 
https://dgft.gov.in/sites/default/fil es/2J.pdf ), lists the following agricultural entities as 
state trading enterprises (STEs) for FTP purposes:  
• Food Corporation of India (FCI);  
• State Trading Corporation (STC);  
• Indian Oil Corporation (IOC);  
• Bharat Petroleum Corporation Ltd. (BPCL);  
• Hindustan Petroleum Corporation Ltd. (HPCL);  
• Oil and Natural Gas Corporation Ltd. (ONGC);  
• Minerals and Metals Trading Corporation (MMTC);  
• Indian Potash Ltd. (IPL);  
• National Dairy Development Board (NDDB);  
• National Cooperative Dairy Federation (NCDF);  
• National Agricultural Cooperative Marketing Federation of India Ltd. (NAFED);  
• Projects and Equipment Corporation of India Ltd (PEC);  
• Spices Trading Corporation Limited (STCL); and  
• Central Warehousing Corporation (CWC).  
In the 2018 Notification, India removed the NDDB as a STE.  No explanation was provided 
by India for this removal.  Please explain why India continues to maintain that the NDDB 
is a STE in the FTP, but removed it for notification purposes.  
 
1 G/STR/Q1/IND/21.  
2 G/STR/N/15/IND (dated 8 November 2018) (2018 Notification) and G/STR/N/16/IND – 
G/STR/N/17/IND (dated 3 October 2019) (2019 Notification).  G/STR/Q1/IND/22  
- 2 - 
  Question 2  
As mentioned above, India has identifie d ONGC, NCDF, and PEC as STEs in the FTP.  
However, none of these STEs were notified for the period 2015 -2018.3 Please explain why 
India maintains that these entities are STEs in the FTP, but did not notify them as part of 
its recent biennial notifications . 
Replies to Questions 1 and 2: 
Our domestic agencies are in the process of reviewing and updating the list of STEs listed in 
Appendix  2J of India's Foreign Trade Policy for the years 2015 -2020. Given that this exercise involves 
several stakeholders, the c urrent situation of lockdowns and social distancing norms has made the 
task of coordinating and receiving substantive inputs even more challenging. As soon as this exercise 
is completed, if it is determined that there is a need to issue a revised STE notif ication, India will do 
so. 
Question 3  
In the 2019 Notification, India removed NAFED, Karnataka State Agricultural Produce 
Processing and Export Corporation (KAPPEC), Andhra Pradesh State Cooperative 
Marketing Federation Ltd. (AP  MARKFED), Gujarat Agro Indu stries Corporation Ltd. 
(GAIC), Ahmedabad, STCL, The Karnataka State Cooperative marketing Federation 
Limited (KSCMFL), West Bengal Essential Commodities Supply Corporation (WBECSC) 
Ltd., Madhya Pradesh State Co -operative Oil Seeds Growers Federation Limit ed 
(MPSCOGFL), National Cooperative Consumers ' Federation of India Ltd. (NCCF), 
Maharashtra State Agricultural Marketing Board (MSAMB), The A.P. State Trading 
Corporation, The North Karnataka Onion Growers Co -operative Society (NKOGCS), and 
Madhya Pradesh State Agro Industries Development Corporation Ltd. as STEs which had 
been granted special export privileges regarding onions.  No explanation was provided by 
India for these removals.  
a. In the 2018 Notification, India provided a note that stated that the export policy 
for onions has been changed from "STE" to "free" and that this "impl[ies that 
the] export of onions is no longer restricted to STEs " (i.e., the import and export 
of items do not require any license or authorization from the Directorate General 
of Foreign Trade (DGFT)).  India also stated on p age 5 of the 2018 Notification 
that these STEs were granted an "exclusive " exporting right for onions.  In other 
words, India appears to be stating that because the exclusivity to import onion 
has been changed, these STEs do not need to be notified.  Is this  correct?  If so, 
then why did India previously notify these STE as having been granted "special " 
privileges, where the exclusivity aspect does not apply?  Also, given that the 
working definition in the Understanding on the Interpretation of Article XVII of 
the General Agreement on Tariffs and Trade 1994 (Understanding) refers to 
enterprises that have been granted "exclusive or special  rights or privileges " 
(emphasis added), please explain why an enterprise should not be notified as a n 
STE just because the ex clusivity aspect has been changed.    
b. Please explain if these changes to the export policy permanently remove any 
legislation or other official government -mandated privileges to trade for these 
removed STEs.  
c. Do the changes to "free" preclude these STEs from  continuing to exert their 
privileges?  
d. If there any changes in the future from "free" to "restricted " or "STE", would 
India re -notify these entities as STEs?  
 
3 PEC was previously notified by India in G/STR/N/14/IND (dated 30 November 2012)  
(2012 Notification ). G/STR/Q1/IND/22  
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  Reply : 
The export policy on onions was changed to "Free" through notification No. 73 (RE -2013) 2009 -2014 
dated 12  March  2014. India does not maintain any state trading enterprises within the meaning of 
Article XVII of the GATT  1994 and the working definition set forth in the Understanding on the 
Interpretation of Article XVII for this product. Therefore, India has not notified these enterprises as 
State Trading Enterprises for export of onions in its notification G/STR/N/16/IND  and 
G/STR/N/17/IND as circulated to Members in October  2019."  
Question 4  
In the 2019 Notification, India removed the Indian Sugar Exim Corporation limited (ISEC) 
as having a special export privilege regarding sugar.  No explanation was provided by 
India for this removal.  Please explain why th is entity was removed.  
Reply : 
Since the 2014 -2015 sugar season, the Indian Sugar Exim Corporation limited has had no preference 
in the export of sugar as per notification No.  3/2015 -20 issued by the Directorate General of Foreign 
Trade on 20  April 2015. In dia will be amending its 2019 STE notification to reflect the export privilege 
that was accorded to the Indian Sugar Exim Corporation limited for the period from 1  April 2014 to 
20 April 2015.  
Question 5  
In the 2019 Notification, India removed FCI as a n STE having a special import privilege 
for grain sorghum (other), buckwheat (other), millet (other), jawar, bajra, ragi, canary 
seed, and other cereals.  No explanation was provided by India for this removal.  
a. Similar to the situation in question 3 above, In dia provided a note in the 2018 
Notification that states that the export policy was changed to "free" and that this 
"impl[ies that ] the import of these commodities is no longer restricted to STEs. " 
Again, India appears to be stating that because the exclus ivity to import these 
commodities has been changed, these STEs do not need to be notified.  Is this 
correct?  If so, then why did India previously notify these STE as having been 
granted "special " privileges, where the exclusivity aspect does not apply?  
b. In addition, given that the working definition in the Understanding refers to 
enterprises that have been granted "exclusive or special  rights or privileges " 
(emphasis added), please explain why an enterprise should not be notified as a n 
STE just because the ex clusivity aspect has been changed.  
Reply : 
The import policy on meslin, rye, maize, grain sorghum, buckwheat, millet, jawar, bajra, ragi, canary 
seed, and other cereals was made "Free" through notification No. 93 (RE -2013)2009 -14 dated 
29 September  2014. In dia does not maintain any state trading enterprises within the meaning of 
Article XVII of the GATT  1994 and the working definition set forth in the Understanding on the 
Interpretation of Article XVII for these products. Therefore, we have not notified FCI as having import 
privileges for the aforementioned  cereals in our notification s G/STR/N/16/IND and G/STR/N/17/IND 
issued in October  2019. 
Question 6  
The United States notes that India 's MA:1 notification to the WTO Committee on 
Agriculture (G/AG/N/IND/6 (dated 7 March 2011)) stated that the DGFT allocates tariff 
rate quotas (TRQs) among eligible entities with import licenses for the following 
commodities:  
• NDDB, STC, NCDF, NAFED, MMTC, P EC and STCL for milk and cream in powder (HS 
codes: 0402.10 and 0402.21) ; G/STR/Q1/IND/22  
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  • NAFED, STC, MMTC, PEC, STCL and State Cooperative Marketing Federations (SCMF) 
for maize (corn), other (HS code: 1005.90) ; 
• NDDB, STC, NAFED, STCL and Central Warehousing Corporation (CWC) for 
sunflower -seed oil or safflower oil and fractions thereof, crude oil (HS code: 
1512.11) ; and 
• NDDB, STC, NAFED, STCL and CWC for rape, colza or mustard oil and fractions 
thereof, other (HS code: 1514.90).  
Please explain why NDDB, STC, NCDF, NAFED,  MMTC, PEC, STCL, SCMF and CWC were not 
notified as having special privileges on the importation of the above -mentioned 
agricultural products under the respective TRQ.  
Reply : 
Our domestic agencies are in the process of reviewing and updating the list of ST Es listed in 
Appendix  2J of India's Foreign Trade Policy for the years 2015 -2020. Given that this exercise involves 
several stakeholders, the current situation of lockdowns and social distancing norms has made the 
task of coordinating and receiving substan tive inputs even more challenging. As soon as this exercise 
is completed, if it is determined that there is a need to issue a revised STE notification, India will do 
so. 
Question 7  
The United States understands that from 2012 – 2017, MMTC, PEC, and STC exp orted 
approximately 6 million metric tonnes of wheat and rice from FCI stocks on behalf of the 
Government of India.  Please explain why these STEs have not been notified in the 2018 
and 2019 Notifications as having a special export privilege for these agric ultural products.  
Reply : 
India will provide a response to this question in due course.  
Question 8  
For all of the above, if India mistakenly did not notify the applicable STE, please clarify 
when India will provide an updated notification to the Working Party.  
Reply : 
Our domestic agencies are in the process of reviewing and updating the list of STEs listed in 
Appendix  2J of India's Foreign Trade Policy for the years 2015 -2020. Given that this exercise involves 
several stakeholders, the current sit uation of lockdowns and social distancing norms has made the 
task of coordinating and receiving substantive inputs even more challenging. As soon as this exercise 
is completed, if it is determined that there is a need to issue a revised STE notification, I ndia will do 
so. 
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