G/STR/Q1/IND/21  
 
30 October 2019 
(19-7256) Page: 1/3 
Working Party on State Trading Enterprises  Original: English  
 
 
STATE  TRADING  
NEW AND FULL NOTIFIC ATION PURSUANT  TO ARTICLE XVII:4(A ) OF THE  
GATT 994 AND PARAGRA PH 1 OF THE UNDERSTA NDING ON  
THE INTERPRETATION O F ARTICLE XVII  
QUESTIONS FROM THE UNITED STATES  
REGARDING INDIA'S NE W AND FULL NOTIFICAT IONS1  
The following communication, dated 28 October 2019, is being circulated at the request of the 
delegation of the United States.  
 
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The United States thanks India for its notifications and poses the following follow -up questions:  
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/files/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 Develo pment 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).  
                                                
1 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/21  
 
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  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 no tification purposes.  
Question 2  
As mentioned above, India has identified ONGC, NCDF, and PEC as STEs in the FTP.  However, none 
of these STEs were notified for the period 2015 -2018.2 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.  
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 Industries Corporation Ltd. (GAIC), Ahmedabad, STCL, The Karnataka 
State Cooperative marketing Federation Limited (KSCMFL), West Bengal Essen tial Commodities 
Supply Corporation (WBECSC) Ltd., Madhya Pradesh State Co -operative Oil Seeds Growers 
Federation Limited (MPSCOGFL), National Cooperative Consumers ' Federation of India Ltd. (NCCF), 
Maharashtra State Agricultural Marketing Board (MSAMB), T he 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 explanat ion 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 page 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 STE just because the exclusivity aspect has been 
changed.     
b. Please explain if these changes to the export policy p ermanently 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?  
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 this entity was removed.  
Question 5  
In the 2019 Notification, India removed FCI as a STE having a special import privilege for grain 
sorghum (other), buckwheat (other), millet (other), jawar, bajra, ragi, canary s eed, and other 
cereals.  No explanation was provided by India for this removal.  
                                                
2 PEC was previously notified by India in G/STR/N/14/IND (dated 30 November 2012)  (2012 
Notification) . G/STR/Q1/IND/21  
 
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  a. Similar to the situation in question 3 above, India provided a note in the 2018 Notification 
that states that the export policy was changed to "free" and that this "impl{ies tha t} the 
import of these commodities is no longer restricted to STEs. " Again, India appears to be 
stating that because the exclusivity to import these commodities has been changed, these 
STEs do not need to be notified.  Is this correct?  If so, then why did I ndia 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 specia l rights or privileges " (emphasis added), please 
explain why an enterprise should not be notified as a STE just because the exclusivity 
aspect has been changed.  
Question 6  
The United States notes that India 's MA:1 notification to the WTO Committee on Agric ulture 
(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, PEC and STCL for milk and cream in powder (HS code s: 
0402.10 and 0402.21) ; 
• 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 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.  
Question 7  
The United States understands that from 2012 – 2017, MMTC, PEC, and STC exported 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 agricultural products.  
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.  
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