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A Project Study Report On

EXPORT DOCUMENTATION IN JSW STEEL LIMITED

SUBMITTED FOR THE PARTIAL FULFILLMENT OF REQUIREMENT FOR THE AWARD OF DEGREE OF

MASTER OF BUSINESS ADMINISTRATION BY RAJASTHAN TECHNICAL UNIVERSITY, KOTA

2007-2009 Submitted by --Kamlesh Kumar Bhandari M.B.A [Marketing + Finance] MBA] Bhilwara (Raj.) Kota)
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Submitted to: --Mr. Tanveer Ahmed [Asst. Professor, Institute of Technology & Management (Affiliated to Rajasthan Technical University,

EXPORTS DOCUMENTATION

Acknowledgement

I express my sincere thanks to my project guide, Mr. Tanveer Ahmed assistant professor at Institute of Technology & Management, Bhilwara for guiding me right from the inception till the successful completion of the project. I sincerely acknowledge him for extending their valuable guidance, support for literature, critical reviews of project and the report and above all the moral support he had provided to me with all stages of this project.
I would like to thank RAJASTHAN TECHINICAL UNIVERSITY for giving an opportunity to work on a valuable project.

I would also like to thank Dr. Rohit Ramesh (Dean administration),Professiors & supporting staff of institute of technology & Management Bhilwara, for their help and cooperation throughout our project.

KAMLESH KUMAR BHANDARI MBA 4th Sem. (ITM Bhilwara)

INDEX

S.N o. I II III IV V VI VII VIII IX X XI XII

Contents Steel Industry Group Profile Company Profile Export Export Transportation Export process Export Documentation Research methodology SWOT Analysis Conclusion Suggestion Bibliography

STEEL INDUSTRY

1. Global Scenario

In 2007 the World Crude Steel output reached 1343.5 million metric tons and showed a growth of 7.5% over the previous year. It is the fifth consecutive year that world crude steel production grew by more than 7%. (Source: IISI)

China remained the worlds largest Crude Steel producer in 2007 also (489.00 million metric tons) followed by Japan (112.47 million metric tons) and USA (97.20 million metric tons). India occupied the 5th position (53.10 million metric tons) for the second consecutive year. (Source: IISI)

The International Iron & Steel Institute (IISI) in its forecast for 2008 has predicted that 2008 will be another strong year for the steel industry with apparent steel use rising from 1,202 mllion metric tonnes in 2007 to 1,282 million metric tonnes in 2008 i.e. by 6.7%. Further, the BRIC (Brazil, Russia, India and China) countries will continue to lead the growth with an expected increase in production by over 11% compared to 2007.

2. Domestic Scenario

The Indian steel industry has entered into a new development stage from 2005-06, riding high on the resurgent economy and rising demand for steel. Rapid rise in production has resulted in India becoming the 5th largest producer of steel.

It has been estimated by certain major investment houses, such as Credit Suisse that, Indias steel consumption will continue to grow at nearly 16% rate annually, till 2012, fuelled by demand for construction projects worth US$ 1 trillion. The scope for raising the total consumption of steel is huge, given that per capita steel consumption is only 40 kg compared to 150 kg across the world and 250 kg in China.

The National Steel Policy has envisaged steel production to reach 110 million tonnes by 2019-20. However, based on the assessment of the current ongoing projects, both in Greenfield and Brownfield, Ministry of Steel has projected that the steel capacity in the county is likely to be 124.06 million tonnes by 2011-12. Further, it is expected that Indias steel capacity would be nearly 293 million tonne by 2020.

Domestic Demand

3.Production

Steel industry was delicensed and decontrolled in 1991 & 1992 respectively. Today, India is the 5th largest crude steel producer of steel in the world. In 2007-08(Apri-June''07), production of Finished (Carbon) Steel was 12.088 million tones (Prov). Production of Pig Iron in 2007-08(April-June'07) was 1.165 Million Tonnes (Prov). The share of Main Producers (i.e SAIL, RINL and TSL) and secondary producers in the total production of Finished (Carbon) steel was 33% and 67% respectively during the period 2007-08 (April-June, 2007).

Last 4 year's production of pig iron and finished (carbon) steel is given below: (in million tonnes)

Category

2003-04

2004-05

2005-06

2006-07 (Provisional)

2007-08 June'07) estimated) 1.165 12.088

(April(Prov.

Pig Iron Finished Carbon Steel

3.764 36.957

3.228 40.055

4.695 44.544

4.960 49.391

(Source: Joint Plant Committee)

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4.Demand - Availability Projection

Demand Availability of iron and steel in the country is projected by Ministry of Steel annually. Gaps in Availability are met mostly through imports. Interface with consumers by way of a Steel Consumer Council exists, which is conducted on regular basis.

Interface helps in redressing availability problems, complaints related to quality.

5. Steel Prices

There has been an up-trend in the domestic steel prices since 2006-07 and the trend accentuated since January this year. Rise in raw material prices, strong demand in the international and domestic market and up-trend in the global steel prices have been some of the reasons cited by the industry for increase in the steel prices in the domestic market.

The mismatch in demand and supply is considered to be the main reason on the demand side for the rise in steel prices. The Government also took various fiscal and other measures for stabilizing the steel prices like exempting pig iron, non alloy steel and steel making inputs like zinc, Ferro-alloys and met coke from customs duty; withdrawing DEPB benefits on export of various categories of steel products and bringing back railway freight on iron ore from classification 180 to 170 for domestic steel producers.

In May 2008, the Government imposed 15% export duty on semi-finished products, and hot rolled coils/sheet, 10% export duty on cold rolled coils/sheets and pipes and tubes and 5% export duty on galvanized steel in coil/sheet form in 11

order to further curtail rising prices and increase supply of steel in the domestic market.

7.

Exports of Iron & Steel

Iron & Steel are freely exportable. Advance Licensing Scheme allows duty free import of raw materials for exports. Duty Entitlement Pass Book Scheme (DEPB) introduced to facilitate exports. Under this scheme exporters on the basis of notified entitlement rates, are granted due credits which would entitle them to import duty free goods. The DEPB benefit on export of various categories of steel items scheme has been temporarily withdrawn from 27th March 2008, to increase availability in the domestic market.

Exports of finished carbon steel and pig iron during the last four years and the current year is as :

(Qty. in Million Tonnes) Finished Steel 2002-2003 2003-2004 2004-2005 2005-2006 2006-2007 (Prov.estimated) 2007-2008(April-June 07) (Prov.estimated) (Source: Joint Plant Committee) 12 4.506 4.835 4.381 4.478 4.750 1.310 (Carbon) Pig Iron 0.629 0.518 0.393 0.440 0.350 0.120

8. Opportunities for growth of Iron and Steel in Private Sector The Growth Profile
(i) Steel The liberalization of industrial policy and other initiatives taken by the Government have given a definite impetus for entry, participation and growth of the private sector in the steel industry. While the existing units are being modernized/expanded, a large number of new/Greenfield steel plants have also come up in different parts of the country based on modern, cost effective, state of-the-art technologies. At present, total (crude) steel making capacity is over 34 million tonnes and India, the 8th largest producer of steel in the world, has to its credit, the capability to produce a variety of grades and that too, of international quality standards. As per the ratings of the prestigious "World Steel Dynamics", Indian HR Products are classified in the Tier II category quality products a major reason behind their acceptance in the world market. EU, Japan has qualified for the top slot, while countries like South Korea, USA share the same class as India.

(ii) Pig Iron In pig iron also, the growth has been substantial. Prior to 1991, there was only one unit in the secondary sector. Post liberalization, the AIFIs has sanctioned 21 new projects with a total capacity of approx 3.9 million tonnes. Of these, 16 units have already been commissioned. The production of pig iron has also increased from 1.6 million tonnes in 1991-92 to 5.28 million tonnes in 2002-03. During the year 200304, the production of Pig Iron was 5.221 million tonnes.

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Emerging Trends in Steel Industry

The low per capita consumption of steel in India of 29 kg compared to 150 kg in the world, and 350 kg in the developed world, according to the National Steel Policy 2005, plus its large population, provide significant growth opportunities for the domestic steel industry. The estimated urban consumption per capita per annum is around 77 kg in India and is expected to reach approximately 165 kg in 2019-20, implying a CAGR of 5 percent. This growth is expected to be driven mainly by the construction, automobile, oil and gas transportation sectors. The rural consumption of steel in India remains at around 2 kg per capita per annum. The National Steel Policy envisages raising the per capita rural consumption of steel to 4 kg per annum from the current levels by 2019-20, implying a CAGR of 4.4 percent. Strong export growth for steel products provides further scope for increase in domestic demand for steel. Over the past ten years steel exports from India have been growing at a rate of around 10.4% per annum. The National Steel Policy 2005 envisages a growth rate of 10% per annum up to 2019-20. Government of India is taking various initiatives to promote steel exports from India such as encouraging strategic alliances with buyback arrangements and dedicated export production through 100% export oriented units. An increasing investment in infrastructure, construction and urbanization as well as growth in automobile, white goods and industrial sector is a further boost to the optimism within the domestic steel industry. Power: Addition of 41,000 MW of power generating capacity between 2002 and 2007 and about 61,000 MW between 2007 and 2012 should drive steel off take, leading to an incremental consumption of 0.4 million tones in FY2006 itself.

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Roads: The government intends to embark on the construction of 48 new projects with a view to four lanes about 10,000 kms of roads in addition to the existing ongoing programme of National Highway Authority of India. With steel intensity in the roads under construction being considerably higher than the legacy infrastructure, the outlook for increased steel consumption on this count appears to be brighter.

Housing and Malls: Low interest rates and easy availability of housing finance has resulted in a housing boom; the Housing and Urban Development Corporation intends to add two million houses every year (35 per cent in urban areas), estimated to create an additional annual demand of 0.6 to 0.8 mtpa of steel. From 25 malls in 2003, India expects to commission more than 220 malls by 2006 (estimated 40 million sq ft) and 600 malls by 2010 (100 million sq ft).

Automobile and ancillaries and White Goods: In 2004-5, Indias auto industry consumed about 2.8 mt of steel (about 8 per cent of Indias steel consumption). This is expected to grow at 11-12 per cent over the next three years following Indias emergence as a global outsourcing hub for the auto industry. Rising income and the easy availability of low cost finance has started a white goods (refrigerators, air conditioners and washing machines) revolution in India, leading to an increased consumption of steel.

White goods: Industrial Projects: Indias industrial growth is encouraging a number of companies to reinvest leading to an increased consumption of steel, the steel industry is expected to emerge as a major steel consumer itself. The positive outlook for increasing steel demand in India along with the strategic advantages offered have resulted in a keen interest from domestic and international steel majors for setting up steel projects in India.

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GROUP PROFILE

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OP JINDAL GROUP

Om Prakash Jindal, the group founder, started off in a small village in Haryana by trading in steel pipes. He established a manufacturing plant near Kolkata in 1952, producing steel pipes, bends and sockets. Soon thereafter, he set up a similar manufacturing unit at Hisar. In the early 1960s Jindal Steel achieved a breakthrough when it developed India's first 100% indigenous pipe mill at Hisar. In 1970, O.P. Jindal established Jindal Strips Limited and set up a mini steel plant at Hisar to manufacture coils and plates through the electric and furnace route. Since then, Jindal Steel has not looked back and has gone from strength to strength. Today, the Jindal group is a multi-billion-dollar, multi-location, multi-product business empire. From mining iron ore, the group produces hot-rolled and cold-rolled steel products, high-grade pipes and value-added galvanized items. It has also diversified into a foray of core sector businesses. The Jindal Group has manufacturing outfits across India, US and Indonesia offices across the globe. The technology-driven group employs large number of people across the globe. O.P. Jindal Group, over the years, has built up a reputation for integrity and dynamism.

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'Growth with a social conscience has been a way of life for the Jindal group. The group's strength lies in its individual companies, with each one committed to consolidating its strengths and excelling in its chosen field. The core team of the Group comprises the four sons of the founder. Prithviraj Jindal leads Jindal SAW Limited. Sajjan Jindal has promoted the JSW Group of Companies. Ratan Jindal leads Jindal Stainless Ltd, while Naveen Jindal is at the helm of affairs at Jindal Steel & Power Ltd. The Jindal group is a US $8 billion conglomerate, which over the last three decades has emerged as one of India's most dynamic business groups. Jindal Steel is one of the largest steel producers in India with 12 plants in India and 2 in USA. Founded in 1952 by O.P. Jindal, a first-generation entrepreneur, it is today a leading steel producer, with interests spanning across the spectrum, from mining iron ore, to manufacturing valueadded steelProducts.

Ratan Jindal

Sajjan Jindal

Prithviraj Jindal

Naveen Jindal

BOARD OF DIRECTORS :

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Mrs. Savitri Devi Jindal Chairperson

Mr. Sajjan Jindal Vice Chairman & Managing Director

Mr. Seshagiri Rao M.V.S. Jt. Managing Director & Group CFO

Dr. Vinod Nowal Director & CEO (Vijayanagar Works)

Mr. Jayant Acharya Director (Sales & Marketing)

Mrs. Zarin Daruwala Nominee Director of ICICI Bank Limited

Mr. V. Madhu, IAS Nominee Director of KSIIDC

Mr. G R Sundaravadivel Nominee Director of UTI Asset Management Co. Pvt. Ltd.

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Dr. S.K. Gupta Director

Mr. Uday M. Chitale Director

Mr. Anthony Paul Pedder Director

Mr. K.Vijayaraghavan Director

Mr. Sudipto Sarkar Director COMPANY SECRETARY Mr. Lancy Varghese STATUTORY AUDITORS M/s. Deloitte Haskins & Sells

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Jindal Stainless Ltd: Jindal Stainless is the largest integrated stainless steel
producer in India and the flagship company of the Jindal Group. Jindal Stainless Ltd. has plants at Hisar and Vizag and is setting up a Greenfield integrated Stainless Steel project in Orissa. Jindal's plant at Hisar is India's only composite stainless steel plant for the manufacture of Stainless Steel Slabs, Blooms, Hot rolled and Cold Rolled Coils, 60% of which are exported worldwide.

Jindal Saw Ltd: A Total Pipe Solutions company manufacturing and marketing
Large Diameter Submerged Arc Welded pipes, Seamless tubes & pipes and Ductile Iron pipes. JSL is one of the country's largest producers of SAW pipes, which is widely used in the energy sector for the transportation of oil and gas

Jindal Steel & Power Ltd:

Asias largest, and the worlds second largest coal-based sponge iron plant, also manufacturing rails, blooms and power. JSPL is one of the leaders in Steel Manufacturing and Power Generation in India. JSPL is the largest private sector investor in the State of Chhattisgarh with a total investment commitment of more than Rs. 10,000 crores. Jindal Power Limited, wholly owned subsidiary of JSPL, is setting up a 1000 MW O P Jindal Super Thermal Power Plant at Raigarh, with an investment of over Rs. 4500 crores. JSPL has also ventured into exploration and mining of high value minerals and metals, like diamond, precious stones, gold, platinum group of minerals, base metals, tar sands etc.

JSW Steel Limited:

JSW Steel Ltd is a fully integrated steel plant having units across Karnataka and Maharashtra producing from pellets to colour coated steel. JSW was founded in1982, when the Jindal Group acquired Piramal Steel Ltd, which operated a mini steel mill at Tarapur in Maharashtra. The Jindals renamed it as Jindal Iron and Steel Co Ltd (JISCO) now known as JSW Steel Limited (Downstream). In 1994, to achieve the vision of moving up the value chain and building a strong, resilient company, JISCO promoted Jindal Vijayanagar Steel Ltd (JVSL) now known as JSW Steel Limited (Upstream).

JSW Foundation
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JSW Foundation, an independent Trust, which administers the social development initiatives of the JSW Group is chaired by Mrs. Sangita Jindal. Every year, the Foundation in consultation with plant managements and CSR teams at the plants, finalises set of activities that get built into the business plan. The Foundation lays emphasis on maintaining a continuum of social development thinking into the conduct of these activities. The Foundation's undertakes activities in the areas of:

Arts, Culture and Heritage Livelihood and Empowerment, Especially of Women Health Education Sports Sustainability

The Foundation's engagement with social development can be classified into the following categories: Activities undertaken by a core team of CSR colleagues across our plant locations. Activities spearheaded by project champions Activities in which members of the ladies club and youth group participate Loaning our facility for community use and benefit Collaboration with civil society, research groups and government programs

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OUR VISION

Preparation and grooming of the next generation of young thinkers. Continuous improvement of cost stewardship in the value chain. Ability to nurture lasting customer relationships, by anticipating needs and delivering beyond expectations. Catalyst for growth amongst the nations steel industries. 23

Marketing of value added branded products for both domestic and global markets.

OUR VALUES

Our Corporate values are dear to us and they guide our approach to work and environment, transforming the way we deliver our products and services. And our corporate values encourage young thinking because.....

COMPANY PROFILE
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1. HISTORY:
JSW Steel Ltd is today a fully integrated steel plant having units across Karnataka and Maharashtra producing from pellets to color coated steel. JSW's history can be traced back to 1982, when the Jindal Group acquired Piramal Steel Ltd, which operated a mini steel mill at Tarapur in Maharashtra. The Jindals, who had wide experience in the steel industry, renamed it as Jindal Iron and Steel Co Ltd (JISCO) now known as JSW Steel Limited (Downstream) In 1994, to achieve the vision of moving up the value chain and building a strong, resilient company, JISCO promoted Jindal Vijayanagar Steel Ltd (JVSL) now known as JSW Steel Limited (Upstream) .Its plant is located at Toranagallu in the Bellary-Hospet area of Karnataka, the heart of the high-grade iron ore belt, and spread over 3,700 acres of land. It is just 340 kms from Bangalore, and well connected to Goa and Chennai ports.The steel industry then was on the threshold of adopting new technology, and the Jindal Group took a lead in adopting the latest technology of steel making, known as 'COREX,' developed by Voest Alpine of Austria. The then JVSL was the first Greenfield project to have 'COREX' as a mainstream facility. (Others elsewhere in the world,

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who had it as part of Brownfield expansion, included ISCOR of South Africa, and POSCO of South Korea).

JSW GROUP OF COMPANIES JSW Group of companies consists of following companies

JSW Steel Ltd. JSoft Solutions Ltd JSoft Solutions Ltd. JSW Holdings Ltd. JSW Infrastructure & Logistics Ltd. Vijayanagar Minerals Pvt. Ltd. Jindal Praxair Oxygen Co. Ltd. JSoft Solutions Ltd

SUBSIDIARIES JSW JSW JSW JSW Bengal Steel Limited Jharkhand Steel Limited Steel Processing Centers Limited Steel (Netherlands) B.V.
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JSW Steel holding (U.S.A.) JSW Natural Resource Ltd. JSW Steel (U.K.) Santa Fe Minin

JSW STEEL LIMITED

Forging ahead, JSW Steel Ltd. is one among the largest Indian Steel Companies in India today. Indias third largest steelmaker, JSW Steel Ltd. consists of the most modern, eco-friendly steel plants with the latest technologies for both upstream & downstream processes.

FACILITIES:
Vijayanagar Works: fully integrated steel plant, located in Bellary district. Adopting COREX Technology to produce Hot Metal. Current capacity: 7 MTPA

Vasind and Tarapur Works: a leading manufacturer of cold rolled and color coated steel. Indias biggest producer & largest exporter of galvanized steel . Its strategic location, with access to the major ports of Mumbai, markets and raw material sources has worked to its advantage.

This is a environmental friendly technology because it contains

only insignificant amounts of gases like NOx, SO2, dust, phenols,
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sulphides and ammonium. Also, waste-water emissions from the Corex Process are far lower than those in the conventional blastfurnace route.

It can replace the blast furnace, or can be used as a source of virgin

iron for minimills.

The JSW group, part of the US$ 4 billion O.P Jindal Group, is a dynamic, Rs 9000 crore (US$2 billion) integrated entity encompassing key industries including steel, power, minerals and port. Mr. Sajjan, Jindal heads JSW, visions the group to be catalyst for accelerated growth in the two crore sectors of steel and power and aims to propel it to new heights. The groups constituent companies are JSW Steel Ltd., JSW Energy Ltd., Vijayanagar Minerals Pvt. Ltd., Jindal Praxair Oxygen Co. Ltd., South West Port Ltd., Southern Iron and Steel Company Ltd. And Jindal South West Holdings Ltd. JSW Steel Ltd is today a fully integrated steel plant having units across Karnataka and Maharashtra producing from pellets to color coated steel. JSW's history can be traced back to 1982, when the Jindal Group acquired Piramal Steel Ltd, which operated a mini steel mill at Tarapur in Maharashtra. The Jindals, who had wide experience in the steel industry, renamed it as Jindal Iron and Steel Co Ltd (JISCO) now known as JSW Steel Limited (Downstream) In 1994, to achieve the vision of moving up the value chain and building a strong, resilient company, JISCO promoted Jindal Vijayanagar Steel Ltd (JVSL) now known as JSW Steel Limited (Upstream) .Its plant is located at Toranagallu in the Bellary-Hospet area of Karnataka, the heart of the high-grade iron ore belt, and spread over 3,700 acres of land. It is just 340 kms from Bangalore, and well connected to Goa and Chennai ports.

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RAW

MATERIALS

The raw materials that company consumes are:

Iron ore: Though companys plants strategic location in the ore rich BellaryHospet belt in Karnataka provides it easy access to ore. Dedicated mines through Vijay Nagar minerals provide about 20%of iron ore requirement. As the cost of 29

iron ore is increasing day by day JSW has taken certain measures for cost reduction for example: Setting up 20 MTPA Beneficiation plant to use lower grade Iron ore to improve Fe content to 63% which reduces cost of procurement, improves productivity in iron making and reduces fuel consumption. Acquiring additional Mines, both in India and abroad to increase self-sufficiency.

Coke: The captive coke oven batteries were producing around 60% of total requirement, thus necessitating importing the balance coke. Cost reduction initiatives. New coke oven batteries are expected to be commissioned in financial year 0809, increasing the captive availability to 75% of requirement. Lower coke consumption with improvement in quality of furnace.

Limestone: The Company produces near about 0.2 mtpa of limestone. As a result it meets 60% -75% of requirement of the facilities.

PRODUCTION HOUSE

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PRODUCT DETAILS: 1. Mild Steel Slabs 2. Hot Roll Coils/Steel Plates/Sheets 3. Hot Rolled Steel Plates 4. Cold Rolled Coils/Sheets 5. Galvanized Coils/Sheets

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MAJOR OEM CUSTOMERS OF JSW

JSW boasts about elite customers both Indian and abroad. Some of them being:

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THE JSW FAMILY GUIDING PRINCIPLES FOR:

Customers Understand and anticipate needs

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Respond promptly Represent accurately products and services Provide high quality products and services Compete with competitors

People Treat co-workers with respect Be dignified at business meetings and company gatherings Recognize meritorious work No biases of any nature Encourage learning

Business Work to optimize profits and shareholder value Maintain accurate books of accounts Let dealers/suppliers compete fairly, go for quality at reasonable cost, pay them in time Comply strictly with government laws and regulations

Behavior Maintain confidentiality of information, plans, finances Act solely in the benefit of the company (no conflict of interest) Do not accept gifts or money

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Desirable not to accept or offer gifts even of nominal value Media contact only through designated personnel Corporate assets, including internet, to be used for business purpose Speaking up incase of a breach

Community Actively assist in improving societys quality of life In case of natural calamity, dont be laid back

Actively assist in preserving environment and natural resources

Export Growth
JSW Steel is a leading exporter of steel year after year. It sells to markets across the world covering 59 countries across Asia Middle East, Europe, America, Africa and Australia.

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FY 05-06
Europe 21.5% USA 33.9% Middle East 13.1%

South America 0.5%

Iran 11.0% Australia 0.3% Africa 7.9% Ethiopia South Africa 0.6% 3.9% China 2.1% Asia 3.0%

FY 06 - 07
Europe 51%

USA 16% Middle East 13% Russia South America 4% 3% South Af rica 2%

Af rica 4% Ethiopia 1%

Iran 4% Asia 2%

NEW PROJECTS UNDERTAKEN BY THE COMPANY

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Sno.

PROJECTS

PURPOSE

CURREN T CAPACIT Y (MTPA)

CURRENT EXPANSION PLANS 1

PROJECT

Phase II Modernization of existing Hot Strip Mill

To increase the capacity up to .7 MTPA by the end of 2nd quarter of 20082009 Increase

2.5

Crude Steel capacity expansion project

capacity

by

2.8MTPA at vijaynagar by September 2008 To be commissioned by September 2009 To be operational September 2010 by and 3.5 -

3 4

State of the Art new Hot Strip Mill (Phase I) State of the Art new Hot Strip Mill (Phase II)

increase capacity by 5 5 Expansion of crude steel capacity MTPA Increase capacity by 3.2 MTPA to reach 10 MTPA prior to the scheduled date 6 Conversion of two Galvanizing lines at Tarapur to Galvalume is 7 8 scheduled in 2008-2009 30 MW power plant being set up at Tarapur Blooming mill at Salem unit will be commissioned in 2008-2009 To meet the requirements of downstream units To increase the capacity of rolled products by .45 MTPA .45 of September 2010 6.8

Beneficiation Plant 20 MTPA

This project would help the company in reducing procurement cost of iron

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ore and achieve lower fuel consumption making due in to iron lower

alumina content and higher productivity 10 New captive power plant 300 MW -

OTHERS MAJOR STEEL PRODUCERS ARE

Tisco (Tata Iron and Steel Corporation ltd) Steel Authority of India ltd. JSW Steel Ltd Jindal Strips Ltd Saw Pipes 39

Uttam Steels Ltd Ispat Industries Ltd Mukand Ltd Mahindra Ugine Steel Company Ltd Tata SSL Ltd Usha Ispat Ltd Kalyani Steel Ltd Electro Steel Castings Ltd NMDC

AWARD OF JSW

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Highest Export of Enginering products Award by Maharashtra Govt. Nitya Shree Award for Export Performance Award of Excellence Top Exporters Awards Best Export performance Innovative HR practices Best Suppilers Award National Quality Award

MEANING OF EXPORT

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Exporter should select the product that can be manufactured and sourced with consistent standard quality at least equal to that of competitors. The product should be available in sufficient quality and it should be possible to supply timely regularly and economic cost. The exporter should tack care such some following points while choosing the commodity which he want to export: Import regulations in respect of such commodities by the importing countries. Availability and profitability of such commodities. Rates of duty drawback and import replenishment in respect of such commodities. Whether such commodities enjoy tariff preferences or not, in the importing country. Suitable packaging and labeling. Mode of transport and suitability of logistics

INTERNATIONALIZATION
The reasons to the move behind the international market are:

To achieve higher rate of profit - The domestic market do not promise a

higher rate a higher rate of profits, business forms search for foreign markets which promise for higher rate of profits.

Expanding the product capacities beyond the demand of the Domestic country. - Domestic companies expanded their production capacities

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more than the demand for the product in the domestic countries, these companies, in such cases, are forced to sell their excess production in foreign developed countries.

Severe Competition in the home country -The countries oriented

towards market economies since 1960s had serve competition from other firms in the home countries. The weak companies which could not meet the competition.

the

Limited home market- When the size of the domestic market is limited
either due to the population or due to lower purchasing power of the people or both,

companies internationalize their operations.

Political stability v/s political instability - Political stability means that

continuation of the same policies of the government for a quite longer period.

Availability of technology and Managerial competence New and

advance technology and managerial competence are attract or pull the companies form the home countries.

High cost transportation-When the foreign company enter other countries

then it face the problem of high cost of transportation for solving this problem the foreign company are inclined to increase their profit margin by locating their manufacturing facilities in foreign countries where there is enough demand either in one country or in a group of neighboring countries.

Nearness to raw material-The source of highly qualitative raw materials

and bulk raw materials is a major factor for attracting the companies from various foreign countries.

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Availability of quality human resources at less cost - The human

resource is available on less comparatively then the domestic country and better quality means the economic thumb rule less cost and better quality.

Liberalization and globalization Most of the countries in the globe

liberalized their economies and opened their countries to the rest of the globe. These changed policies attracted the multinational companies to extend their operations to these countries.

To increase market share- Some of the large-scale business firms would

like to enhance their market share in the global market by expanding and intensifying their operations in various foreign countries. Companies that expand internally tend to be oligopolistic. Smaller companies expand internationally for survivals while the large companies expand to increase the market share.

To avoid tariff and import quotas- It was quite common before

globalization that government imposed tariffs or duty on imports to protect the domestic company. Sometimes Government also fixes import quotas in order to reduce the competition to the domestic companies from the competent foreign companies. These practices are prevalent not only in developing countries but also in advanced countries.

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EXPORT TRANSPORTATION

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Mode of Transport By Road

Through the road transportation the consignment sent to the export through the by truck or container. The freight forwarder arrange the truck for the sending consignment. The send of the consignment is better when the transporter is near the exporter.

Advantage
Low cost- The freight is low when the importer is near. Less formalities- Through the formalities are less than the air or the Ocean. Easily Available-The truck are easily available so the not require to giving the enquiry on the net

Disadvantage
Costly- when the consignment send on the long root then the road transportation cost is to high.

Quantity restriction- when the quantity is more then the road is not a right choice to send the consignment.

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By Rail
Through the rail transportation the consignment sent to the export through the by train route. The freight forwarder arranges the rail wagon as per the requirement of the exporter for the sending consignment. The send of the consignment is better when the transporter is near the exporter.

Advantage
Low cost- The freight is low when the importer is near. Less formalities- Through the formalities are less than the air or the Ocean. Easily Available-The truck are easily available so the not require to giving the enquiry on the net

Disadvantage
Costly- When the consignment sends on the long root then the road transportation cost is too high. Route restriction- The availability of the rail route is not every where in the world or the places.

Sample of Bill of Landing of Rail

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Air Way
The Airway of transportation is most fast and very effective in time constraint. The air way is developed latest of the comparisons of the other mode of transport. The airway is the shortest way for the sending the goods but it is a very costly and limitation of the quantity.

Benefits of Air-way

Faster delivery The ports worldwide can be reached in 1 or 2 days or in a few hours by airfreight, thus reducing the risks of theft, pilferage and damage to the goods. Delivery to certain areas may take several weeks to arrive by ocean and land freight. Time sensitive or perishable goods, such as fresh seafood and flowers, often rely on the airfreight.

Better security Airfreight has a tighter control over its cargo, thus it has better security that reduces the cargo exposure to theft, pilferage and damage. Less packaging Airfreight requires less packaging because of faster delivery and better security. Less packaging may mean saving freight, packaging and labor costs. Lower insurance Airfreight is faster and has better security than the land and ocean freight, thus the insurance premium rate generally is lower. Shorter collection time in an pen account trade arrangement

The time to collect payment in an open account trade arrangement most often runs from the time the customer receives the goods and not from the time the goods are dispatched. Air delivery is fast, thus the collection time is shorter.

Disadvantages of Air-way
Costly- the air freights to costly all exporters and importer cannot afford it. Thus
airfreight is increase the cost of the product and this de-motivated the export . Limitation of the sending the goods - through the air shipments the to send the bulk or the completion of the bulk order is too hard to complete for the exporter .

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EXPORT PROCESS

49

50

Stages of Shipment: There are three stages of shipment preshimpment

stage, shipment stage or last one is postshipment which are shown below:

Pre-ShipmentStage

Shipment Stage

Post-Shipment Stage

PORT AND SHIPPING FORMALITIES

This is an important stage in physical Distribution Management and Processing of Export Orders. Procedurals formalities for shipment of export cargo differ from port to port because of different reasons e.g. Port trust Act, Dock Bye Laws, custom of trade etc. Like custom formalities, these are normally attended to by CHAs who specialize handling this part of export transactions. Export cargo can be brought to the port only after the ship has been allotted a berth and cleared for loading. Some port authorities in India require the shippers to pay port charges and have their shipping bills passed by the customs before carting their goods to the docks. At the Mumbai port however shippers have the facility of paying port charges after the shipment. Before bringing the cargo to the shipment shed the shipper has to obtain the carting permission from the shed superintendent and also the ships agent on the document prescribed by the port trust this document is known as, Port Trust Copy of the Shipping Bill at Port. Carting order is the permission to bring the goods inside the docks and store them in proper sheds.

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Steps involved in obtaining carting point

Fixing of the vessel with the owners/nomination of the vessel by buyers in case of fob shipments. Nomination of shipping agent by owners Nomination of load port Shipping agent to obtain rotation no. Shipping bill to be filed by CHA Necessary Docs. (N- form) to be sent to Octroi agent at Octroi Naka by CHA Shipping agent to give tentative ETA to port and to us. CHA to provide shipping bill photocopies to shipping agent for obtaining carting point. Port grants carting permission max. 7 days prior to arrival of vessel.

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Choosing the Carrier

Unless the importer specifies a carrier, the exporter is free to choose a shipping company or airline which offers a competitive rate and can meet the latest date for shipment. Certain importing countries may prohibit the use of flag vessels of a hostile country and any vessels that would make a stopover in a hostile country en route to their territory.

The Earliest Date of Shipment

Importers may stipulate in the letter of credit (L/C) an earliest date of shipment to prevent the exporter from shipping the goods too early, thus avoiding the high inventory, warehouse congestion and financial strain

The Latest Date of Shipment

The latest date of shipment or the last date for shipment stipulated in the letter of credit (L/C) prevents the exporter from shipping the goods too late, thus avoiding an inventory shortage. This stipulation is important especially for seasonal goods or during currency devaluation in the importing country, in which a late shipment may render the goods unsalable or cost more to the importer.

Disregarded Expressions as to the Date for Shipment

Expressions such as "immediately", "promptly", "and as soon as possible" and the like should not be used for shipments. If they are stated in the letter of credit (L/C), the bank will disregard them.

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There are various documents present in export, which are as follows:

1. FORMAT OF LETTER OF CREDIT 2. LETTER OF CREDIT CHECK LIST 3. FORMAT/INSTRUCTION FOR OPENING OF CREDIT 4. COMMERCIAL INVOICE 5. MILL WEIGHT LIST 6. DETAILED PACKING LIST 7. PURCHASE ORDER 8. TRANSPORTATION DOCUMENT 9. SALES CONTRACT 10. INSPECTION CERTIFICATE 11. CERTIFICATE OF ORIGIN 12. MATES RECEIPT 13. LETTER OF INDEMNITY SHIPMENT ADVICE

Difference b/w Pre & Post Documents

PRE-SHIPMENT DOCUMENTS
Commercial Invoice. Packing List. L/C(Letter of credit) Purchase order format. Sales order. Performa Invoice..

POST-SHIPMENT DOCUMENTS
B/L (Bill of Lading). M.T.C Fumigation. Acknowledgement. Insurance. Quality Certificate. Weight Certificate. Certi. Of Origin. Bill of exchange. Shipment Advice. D.E.P.B.

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International market department

{Deal mostly through agents (because of security reasons and fast accessibility and means of communication)}

Get orders (work orders)

In which mode of payment is written which is done mostly through letter of credit and advance payment

Work orders are transferred to plant Manufacturing

Manufacturing process starts (conversion of raw material into finished goods which are to be exported)

Documents are prepared

{As per mode of payment (they especially consist of packing list). They are sent to export finance department for negotiation}

Terms:L/C:- Letter of Credit. S.D.F:- Self Declaration From. D.E.P.B:- Duty Entitlement Pass Book Scheme. E.D.I:- Electronic Data Interchange. MTC: - Mill Test Certificates B/L:- Bill of Lading. B.R.C:- Bank Certificate of export .

and Realization

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Commercial Invoice
The commercial invoice is a record or evidence of transaction between the exporter and the importer. It is similar to an ordinary sales invoice, except some entries specific to the export-import trade are added.

PERFORMA

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Specific Language Requirements in the Commercial Invoice

Certain importing countries may require that the commercial invoice and the packing list be made out in, or translated to, the language of the importing country, for example, in French for shipment to France, in Italian to Italy, and in Spanish to Mexico and Venezuela.

Declaration on Commercial Invoice

The declaration on the commercial invoice for some countries must be in a specified wording. The exporter may check the wording with the customs broker, the government external trade department, or the foreign government trade office concerned in the exporting country. The content of a typical declaration includes a sworn statement from the exporter indicating that the goods in question are manufactured in the exporting country, and that the amount shown in the invoice is the true and correct value.

Certification and/or Legalization of Commercial Invoice

The letter of credit (L/C) from certain importing countries, in particular from the Middle East, requires the certification and/or legalization of the commercial invoice. The certification, which usually is performed by the local Chamber of Commerce of the exporting country, is to confirm that the invoice and declaration (in the invoice) are correct. The legalization, which is done by The Consulate or The Commercial Section of the Embassy of the importing country, is to verify that the invoice is correct.
d payment of a fee. The processing time may take one week.

Corrections or Changes in the Commercial Invoice

Any visible corrections or changes made in the commercial invoice must be initialed. In practice, the initial usually is done using a rubber stamp bearing the word "CORRECTION".

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Signature and/or Stamp

The commercial invoice and packing list need not be signed, unless otherwise stipulated in the letter of credit (L/C). In practice, the original and the copy of the commercial invoice and packing list are often signed.

Description of Goods
The description of the goods in the commercial invoice must correspond with the description in the letter of credit (L/C). In all other documents, the description can be in general terms provided it is not inconsistent with the description in the L/C.

.Marks & Numbers Shipping Marks and Numbers for detail information. Quantity
If the letter of credit (L/C) does not stipulate the quantity in a stated number of units (i.e., it does not state in units such as piece, set, box, dozen, or gross), or unless the L/C stipulates that the quantity of the goods specified must not be exceeded or reduced, a tolerance of 5% more or 5% less quantity is permitted, provided the total amount does not exceed the amount of the L/C. In the sample L/C the stated quantity is 100 Sets, thus the quantity in the invoice must be 100 Sets. If such sample L/C does not state the quantity, the Shivnath Harnarain India Ltd Exports can ship between 95 sets and 100 sets of pneumatic tools, but not over 100 sets as the total amount will exceed the L/C amount of US$25,000. If such L/C does not state the quantity and the L/C amount is US$26,250 or more, the exporter may ship between 95 and 105 sets. If the L/C quantity is indicated using the words "about", "approximately", "circa" or similar expressions, the quantity in the invoice cannot exceed 10% more or 10% less than the quantity indicated in the L/C. For example, if the L/C quantity is "about 100 sets", the quantity in the invoice can be any quantity between 90 sets and 110 sets, provided the total amount does not exceed the amount of the L/C.

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Unit Price
If the letter of credit (L/C) unit price is indicated using the words "about", "approximately", "circa" or similar expressions, the unit price in the invoice cannot exceed 10% more or 10% less than the unit price indicated in the L/C. For example, if the L/C unit price is "about US$250", the unit price in the invoice can be any unit price between US$225 and US$275, provided the total amount does not exceed the amount of the L/C.

Amount
Unless otherwise stipulated in the letter of credit (L/C), the amount must not exceed the amount permitted by the L/C. If the L/C amount is indicated using the words "about", "approximately", "circa" or similar expressions, the amount of the invoice cannot exceed 10% more or 10% less than the amount indicated in the L/C. For example, if the L/C amount is "approximately US$10,000", the amount of invoice can be any amount between US$9,000 and US$11,000.

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Packing List
The packing list is an extension of the commercial invoice, as such it looks like a commercial invoice. The exporter or his/her agent the customs broker or the freight forwarder reserves the shipping space based on the gross weight or the measurement shown in the packing list. Customs uses the packing list as a check-list to verify the outgoing cargo (in exporting) and the incoming cargo (in importing). The importer uses the packing list to inventory the incoming consignment. For the fields in the preamble of the packing list, please refer to the Explanations: Fields in the Preamble of the Commercial Invoice. For the purpose of explaining other fields in the packing list, it is assumed that the pneumatic tools in the sample L/C contain the following data:

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Package No.
The entries preferably arranged in sequence from the lowest number to the highest, that is, from package No. 1 and up. From the sample L/C, enter "C/No. 1-50" or the like in the field (Package No.), provided it is not inconsistent with the marks and numbers on the master cartons.

Item No. and Description of Goods

The description of the goods in the packing list can be in general terms, provided it is not inconsistent with the description in the L/C. From the sample L/C and data of the pneumatic tools above, entering "A380" and "'ABC' Brand Pneumatic Tools" in the fields will satisfy the requirements.

Quantity

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It shows the total quantity within a stated range of the package number and the breakdown in each package. The stated range is C/No. 1-50, enter: 100 Sets 2 Sets/Ctn. or 100 Sets 2 Sets @ Ctn. or the like in the field. The / and @ used here stands for per or each.

Weight
It shows the total weight within a stated range of the package number and the weight of each package. The stated range is C/No. 1-50, enter: or the like in the field and put a notation " Gross Weight". As far as the carrier is concerned, the gross weight or measurement of a consignment is needed to calculate the freight. In case the goods are assessed in the importing country or exported on the net weight basis, it is necessary to show the net weight and gross weight in the packing list. The entry may appear as: N.W. 1,000 Kgs. G.W. 1,100 Kgs.

Signature and/or Stamp

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The packing list and commercial invoice need not be signed, unless otherwise stipulated in the letter of credit (L/C). In practice, the original and the copy of the packing list and commercial invoice are often signed.

Marks & Numbers Shipping Marks and Numbers for detail information.

Corrections or Changes in the Packing List

Any visible corrections or changes made in the packing list must be initialed, as in the commercial invoice and all other export documents, by their respective issuers. In practice, the initial usually is done using a rubber stamp bearing the word "CORRECTION".

Summary of Totals in a Consignment

Total Number of Packages

For example a consignment where the range of the carton number is as follows: C/No. C/No. C/No. C/No. C/No. 1-8- Product A 9-17- Product B 18-23- Product C 24-30- Product D 31-42- Product E - Product F

C/No. 43-50

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put a summary "Total 50 Cartons" in a succeeding row after the "C/No. 43-50".

Total Quantity
If a consignment consists of different units, preferably show all the units used in the summary of totals. For example, a shipment includes: 100 dozen 200 dozen 300 boxes 400 boxes

- Product A - Product B - Product C - Product D

as such the total shows "300 Dozen and 700 Boxes"

Total Weight and Total Measurement

If the net weight and gross weight are used in the breakdown, the summary must show the total net weight and the total gross weight. If kgs., lbs., CBM and cft. are used in the breakdown, the summary must show the total of kgs., lbs., CBM and cft.. Under certain circumstances, such as in a consignment consisting of a few master cartons where each carton contains several small items of different sizes, it is necessary to show the breakdown of the quantity of each item. There is no need to show the breakdown of the weight and measurement of each carton. Simply entering the total weight and the total measurement of the consignment in the summary row would satisfy the export 64 requirements.

Principles of Cargo (Marine) Insurance

The cargo (marine) insurance works on the principles of insurable interest, utmost good faith, and indemnity. Insurable Interest When the goods are lost or damaged and the owner of the goods (i.e., the title holder in the goods) suffers a loss, fails to realize an expected profit, or incurs liability from the loss or damage, the owner (the title holder) is deemed to have an insurable interest in the goods. When the exporter delivers the goods, the insurable interest in such goods transfers at the point and time where the risk shifts from the exporter to the importer, as determined by the international commercial terms used. For example, the point and time where the risk shifts in:

CIF (Cost, Insurance and Freight to the named port of destination) --the point the risk shifts is on board the ship at the named port of loading, as such the insurable interest transfers from the exporter to the importer at the time the goods pass over the ship's rail.

CIP (Carriage and Insurance Paid To the named place of destination) --the point the risk shifts is at the depot in the country of shipment, as such the insurable interest transfers from the exporter to the importer at the time

the goods are loaded on truck or container, rail car, or airplane (or goods placed in the custody of an air carrier) at the named point of departure.

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The time the insurable interest transfers from the exporter to the importer is, technically, the time the exporter endorses the specific policy or the insurance certificate to the importer, as the case may be. The insurance certificate bears the open policy number of the exporter and, like in a specific policy, the claim agent at port of destination and that claim payable at destination are also indicated. The importer relies on the specific policy or the insurance certificate and the supporting claims documents as proof that the goods have been insured and that he/she has the insurable interest in the goods when filing for insurance claims against loss or damage. In the trade terms DDU and DDP, the exporter is responsible for the risks up to the delivery of goods to the final point at destination (the project site or importer's premises usually), as such the insurable interest in the goods does not transfer from the exporter to the importer in the shipment. Some countries may require that the import and/or export shipments be insured with their national insurance companies.

Utmost Good Faith The principle of utmost good faith is indispensable in any insurance contract. Under the open policy the insurer usually knows only of the shipments made by the exporter after the receipt of the insurance declaration form and/or the copy of the insurance certificates. Under such circumstances, a consignment may have reached the importer in:

Good condition, that is, without sustaining any loss or damage, before the insurer knows of such consignment. If the exporter knows that the 66

consignment has safely reached the importer and deliberately does not declare such consignment in the insurance declaration form in order to avoid paying the insurance premium, such action is a breach of good faith. Consequently, the insurer may cancel the insurance policy issued to the exporter when the exporter's bad faith is known.

Bad condition that is, sustaining loss or damage, before the insurer knows of such consignment. Whether or not the exporter knows that the consignment has not safely reached the importer and fails to declare such consignment in the insurance declaration form, the insurer is liable to pay for the loss or damage out of good faith.

Indemnity -Cargo insurance is a contract of indemnity, that is, to compensate for the loss or damage in terms of the value of the insured goods. The amount insured as agreed between the insurer and the assured forms the basis of indemnity. Institute Clauses The Institute Clauses of the Institute of London Underwriters often referred to as the London Clauses or English Clauses, form the basis of the cargo insurance contract in many countries.

In U.S.A. and some other areas, the Institute Clauses of the American Institute of Marine Underwriters, often referred to as the American Institute Clauses or American Clauses, are used. The American Clauses and the London Clauses can be different from one another. The most common Institute Clauses include the Institute Cargo Clauses, Institute War Clauses, Institute Strike Clauses, and Institute Air Cargo Clauses. Institute Cargo Clauses 67

The Institute Cargo Clauses specifically excludes the risks of war (in the F.C.&S. Clause---Free of Capture and Seizure Clause) and the risks of strikes, riots and civil commotions (in the F.S.R.&C.C. Clause---Free of Strikes, Riots and Civil Commotions Clause). The risks of delay in delivery and inherent vice are not included in the Clauses. Institute War Clauses (Cargo) The Institute War Clauses (Cargo) specifically exclude the loss, damage or expense arising from any hostile use of any weapon of war employing atomic or nuclear fission and/or fusion or other like reaction or radioactive force or matter. The Clauses cover:

The risks excluded in the Institute Cargo Clauses by the F.C.&S. Clause; The loss of or damage to the interest insured caused by: hostilities, warlike operations, civil war, revolution, rebellion, insurrection or civil strife arising there from; mines, torpedoes, bombs or other engines of war; The general average and salvage charges incurred for the purpose of avoiding, or in connection with the avoidance of, loss by a peril insured against by these clauses.

Under the War Clauses, the insurance takes effect only as the interest insured are loaded on an overseas vessel and terminates either as the interest are discharged from the overseas vessel at final port or place of discharge, or on expiry of 15 days counting from midnight of the day of arrival of the vessel at the final port or place of discharge, whichever shall first occur. In other words the goods are covered only while they are on a vessel. In the case of transhipment, the overseas vessel arrives at an intermediate port or place to discharge the interest for on-carriage by another overseas vessel, the insurance 68

terminates on expiry of 15 days counting from midnight of the day of arrival of the vessel at the intermediate port or place, but reattaches as the interest are loaded on the on-carrying overseas vessel. During the period of 15 days such insurance remains in force after discharge at such intermediate port or place of discharge.

Institute Strike Clauses (Cargo) The Institute Strikes, Riots and Civil Commotions Clauses is commonly referred to as the Institute Strike Clauses. The insurance covers the loss of or damage to the property insured caused by strikers, locked-out workmen, or persons taking part in labor disturbances, riots or civil commotions, and persons acting maliciously. However, it does not cover the loss or damage proximately caused by delay, inherent vice or nature of the property insured and the loss or damage caused by hostilities, warlike operations, civil war, revolution, rebel-lion, insurrection or civil strife arising there from.

Institute Air Cargo Clauses (All Risks) The Institute Air Cargo Clauses (All Risks) are used specifically in airfreight. The terms and conditions of cover closely follow the Institute Cargo Clauses (All Risks) revised to suit air shipments. The Clauses exclude sending by Post (i.e., postal shipments not covered). Customs Export Declaration In many countries, export shipments valued below a minimum requirement may not require a formal customs declaration. The purposes of customs export declaration are to 69

verify and regulate outgoing cargo (including re-export goods) and to collect the statistical data (of the product, quantity, value, and destination) for export references. The format of customs export declaration forms varies from country to country. The form typically contains the information found in the commercial invoice and the bill of lading or waybill. In addition, the form may include:

The business license number and/or tax account number and/or export permit (license) number of the exporter

The business license number of the manufacturer from whom the exporttrader buys the export goods The commodity code or category of goods The country of destination and its country code (a numeric country code may be assigned to each importing country by the customs of exporting country for compiling statistics) The name, address and code (or license) number of the customs broker or forwarder The customs charges The exporter normally must sign an authorization paper (the power of attorney) allowing the customs broker or the forwarder to handle the customs declaration.

In certain countries, exporters may prepare the customs declaration forms by

BY OCEAN By marine the exporter send their order through the ocean for the product but above all the kind of documents require. Ocean (Marine) Bills of Lading The bill of lading (in ocean transport), waybill or consignment note (in air, road, rail or sea transport), and receipt (in postal or courier delivery) are collectively known as the transport documents. 70

Please see the sample Ocean Bill. The bill of lading (B/L) serves as a receipt for goods, an evidence of the contract of carriage, and a document of title to the goods. The carrier issues the B/L according to the information in a dock receipt, or in some cases according to a completed working copy of the B/L supplied by the customs WWWWWSJHJKDHAJKHKLAJHDKJFHKLJAHDKJFHKLAHFJKHAKLJHJHDFLKJA HDKJHFKKKKKKKKJbroker. The B/L must indicate that the goods have been loaded on board or shipped on a named vessel, and it must be signed or authenticated by the carrier or the master, or the agent on behalf of the carrier or the master. The signature or authentication must be identified as carrier or master, and in the case of agent signing or authenticating, the name and capacity of the carrier or the master on whose behalf such agent signs or authenticates must be indicated. Unless otherwise stipulated in the letter of credit (L/C), a bill of lading containing an indication that it is subject to a charter party and/or that the vessel is propelled by sail only is not acceptable.

WRIBG OATG HJHFJHAHDFHADFF

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72

MILL TEST CERTIFICATES

Mill Test Certifices is Certified that the product is make by the origin and What king of raw Material is used for make the product the mill test Certificates is given by the Manufactring the comical and raw Material quantity and how to process of making the product .

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CERTIFICATE OF ORIGIN
In this certificate the Manufare declare the product of export is original and the product is made in India .This certificate is certified by the INDIAN MARCHANTCHAMBER. The product is clearly classified and difned by the exporter

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BENEFICIARY DECLRIATION
Beneficiary declriation is a detialted the various document is send the importer time to time and this document the FAX recipt and other recipt of send of letter is submitted to the customer . PERFORMA OF DECLRIATION Date

SHIPMENT ADVICE
To Oman Insurance Company(PSC) P.O.Box 1931, Sharjah, U.A.E. Fax No 009716 5724870, Tel : 009716 5723803 Ref : Open Cover Note/Policy No SMOC200500030068 Dated 28/2/05

As per the terms of the letter of credit we hereby advising you the following shipment details. Name of the Carrying Vessel Date of Shipment Number of Packages Shipping Marks TS DAMMAM 30.06.2008 16 Coils TSSC/201514/2008, P.O.BOX:1818, SHARJAH, U.A.E. Amount : US$. 94082.30 Letter of Credit Number : EBI1LC08003664 Policy Number : SMOC20050003068 Bill of Lading Number : EPIRINDMUM120366 Port of Loading : GTI PORT IN INDIA Port of Discharge : JEBEL ALI PORT ISSUING BANKS NAME : EMIRATES BANK INTERNATIONAL PJSC LETTER OF CREDIT NUMBER : EBI1LC08003664 DATE OF ISSUE : 080429 For JSW Steel Limited Authorised Signatory : : : :

Date

75

To TECHNICAL SUPPLIES AND SERVICES CO LTD. P.O.BOX:1818 SHARJAH, UAE TEL:06-5341344, FAX:06-5341686

Sub : One Set of Non-Negotiable Documents against Letter of Credit Number

EBI1LC08003664 Dated 080429, Issuing Banks Name : Emirates Bank International PJSC Please find enclosed Set of Non - negotiable documents towards shipment of 16 Coils (64.220 M.Ton Net Weight) of Supply of Prepainted Aluzinc Coils Documents enclosed as under 1. 2. 3. 4. 5. Commercial Invoice No : JSW/2008-2009/PPGL/5106 Copy of Bill of Lading No Certificate of Origin. Packing List dated Mill Test Certificate dated

Please find the same in Order. For JSW Steel Limited Authorised Signatory

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Date

Beneficiarys Certificate
Sub :Our Commercial Invoice no. JSW/2008-2009/PPGL/5106 Dated Letter of Credit Number EBI1LC08003664 Dated 080429, Issuing Banks Name :
Emirates Bank International PJSC

With regard to the shipment made against above referred Commercial Invoice, we hereby certify that One full set of NonNegotiable copies of Documents have been sent to Applicant by Courier Service within 1 week of Shipment. A copy of Courier Receipt attached. For J S W Steel Limited

Authorised Signatory

77

Date :

Weight List

Sub :Our Commercial Invoice No. JSW/2008-2009/PPGL/5106 Dated

Letter of Credit Number EBI1LC08003664

Issuing Banks Name : Emirates Bank International PJSC

With regard to the shipment made against above referred Commercial Invoice we hereby certify that the weight as follows : Description of Goods : PREPAINTED ALUZINC COILS Total Net Wt in MT : 64.220 MT Total Gross Wt in MT : 65.035 MT

Total No. of Coils : 16

For JSW Steel Limited Authorised Signatory

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BILL OF LODING
Bill of loding is Cleared classified by the Net. Wg. & Gross Wg. The date of shipment and the port of destination is classified in this document .It is certified the what king of product and the what king of quantity is Export.

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General Cargo Container

Dry Cargo Container

(1) General purpose (dry cargo) container

It is suitable for the widest varieties of cargo. It is fully enclosed and weatherproof, having rigid walls, roof and floor, with at least one of its walls, either end wall (end loading) or side wall (side loading), equipped with doors.

ADVANTAGES OF CONTAINER:
1. Less packing needs 2. Cargo arrives in better condition 3. Rates are likely to remains more competitive when compared with conventional tonnage. 4. More reliable transmit 5. Overall quality service. 6. Faster transit increase the exporter and importers

DISADVANTAGES
1. The container owing company has a complex task of monitoring and ensuring full utilization of such equipments. 81

In some restriction exist regarding internal movements particularly 40footer.

Container
First of all the shipping through the container it is used by exporter when the export quantity is very less or not enough to the charter the vessels. The process to the hiring the container is in these steps. 1. First of all the marketers of the exporter received the order of the products selling and the decided the terms of the selling and the payments. 2. After first steps the marketers communicate with the shipping departments 3. On the marketers information the shipping departments know that how much container are required to send the product. 4. The shipping departments know that where the buyers or consignee or notify party is lying. 5. When the shipping departments know that where the buyers. Shipping departments enquiry submit to the various freight forwarders and the invite the tenders. When the shipping departments received the suitable freight forwarder and they are negotiate with various freight forwarders. 6. The freight forwarders hire the container and send a their bill to shipping departments. 7. Simultaneously the C.H.A. of exporters find or received delivery order (D.O.) the C.H.A. stuff the container after the delivery of the container. 8. C.H.A. fulfill other formalities and loaded on the vessels.

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The basically the world divided in following parts to consider the oceans Europe sectors Africa Gulf Asian Far east South east South America

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Comparison of Various Methods of Payment

Incoterm are a uniform set of international rules, promulgated by ICC (International Chamber of Commerce) in Paris, for the interpretation of the terms most commonly used in international contracts for the sale of goods.

FCA: Free Carrier (named place)

Seller hands over the goods, cleared for export, into the charge of the carrier named by the buyer at the named place or point

FAS: Free Alongside Ship (named port of shipment)

Seller delivers the goods alongside the vessel on the quay or in lighters at the named port of shipment.

FOB: Free On Board (port of shipment)

Seller delivers the goods on board the vessel or at the airport at the named port/airport of shipment.

CFR: Cost and Freight (named port of destination)

Seller pays costs and freight and to deliver the goods to the named port of destination. This term can only be used for sea and inland waterway transport.

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CIF: Cost, Insurance, and Freight (named port of destination)

Seller pays costs, insurance and freight to deliver the goods to the named port of destination.

CPT: Carriage Paid to (named place of destination)

Seller pays freight and insurance for carriage of the goods to the named destination.

CIP: Carriage and Insurance Paid to (named place of destination)

Seller pays freight and insurance for the carriage of the goods to the named destination.

DAF: Delivered at Frontier (named place)

Seller delivers the goods at the named point and place at the frontier.

DES: Delivered Ex Ship (named port of destination)

Seller makes the goods available to the buyer on board the ship uncleared for import at the named port of destination.

DEQ: Delivered Ex Quay - Duty Paid (named port of destination)

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Seller makes the goods available to the buyer on the quay (wharf) at the named port of destination, cleared for importation.

Charter Shipping

Charter shipping is a tramp service. The term tramp, as used in the ocean shipping, refers to a cargo ship not operating on regular routes and schedules, and picking up cargo only when it is chartered (hired) from the ship operator. While conference and non-conference shipping are for general cargoes, charter shipping usually is for bulk cargoes like oil, coal, ore, and grain. Charter shipping has the lowest freight rate per unit of weight or measure. A charter party is required in charter shipping. A charter party---charter party contract---is a written contract between the ship operator and the charterer (shipper). The contract normally includes the ports, freight rate and time involved in the voyage(s). The agreements between the ship owner and the charters is knows charter party and signed by both the parties or their respective agents. Charter parties are concluded on the basis of different forms of charter party agreements depending upon the custom of trade. Normally the agreements the concluded on standard forms of charter parties by IMCO. The NYPE forms are used of time charter of bulk carriers and the BPTIME/SHELLTIME for time chartering of tankers. For voyage charter, standard forms of charter parties or the GENCON charter party forms develops by the BIMCO are most widely used.

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Conference Shipping
The conference carrier or member of a freight conference provides conference shipping. The freight conference---conference or steamship conference or liner conference---is a group of operators of vessel who operate on the same routes and cooperate on shipping schedules at the standardized freight rates between ports.Conference shipping has regular sailing schedules, thus is called the liner service. Most ocean freight is carried by conferences. Conference carriers or their agents issue an ocean bill of lading.

Non-conference Shipping
The independent carrier or operator of vessel who is not a member of a freight conference, sometimes called outside shipping, provides non-conference shipping. Independent carriers, which carry about 25% of the ocean freight, operate on selected trade routes in competition with conference carriers. Non-conference shipping often does not have regular sailing schedules and freight rates between ports. Consequently, it is perceived as less dependable than conference shipping. Independent carriers or their agents issue an ocean bill of lading. The charter of ship follows mostly this step. 1. L/C open then in 30 days for to hire the ship 2. Traders/seller giving the time period to hire the ship. 3. Shipping departments is enquiring for the ship through the broker. Shipping department tell their requirements to the brokers such how much rent or fare ready to pay 4. Through the enquiry the shipping departments find the suitable vessels for the exporting goods.

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5. Then the shipping departments and shipping company contact with each other through the broker. Shipping company offer and shipping department counter offer.

6. When shipping department and shipping company both are mutually consensus then agreement will be done. 7. When shipping departments and shipping company make agreement then shipping department charter vessels. 8. The ship company giving the information to the shipping department of owner/Desponent owner of ship E.T.A, E.T.B, 9. Shipping department ready their stevedores as per their giving information. 10. The ship loaded through the Crain and if the ship are stop/hold more than contractual period then charter party has to pay the dunnage charges and if the vessels are loaded before the contractual period then the shipping company giving dispatch. 11. After the loading the ship will go for the discharge or importer port and the time of travel between the loading and unloading port call transit time. The ship operator issues a charter party bill of lading. Unless a letter of credit (L/C) permits or calls for a charter party bill of lading, the bank will reject such transport document in the L/C negotiation.

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Inco terms
Terms use in chartering or hiring the ship contract and use on port. D.W.T.- Death weight means maximum load bear by the ship or vessels DRAFT-After the loading the cargo how much ship goes in to the water? G.R.T.- Gross tones G.N.T.-Gross net tones. MGO-IFO- Ship fuel GENCON The Baltic and international maritime conference charter (As 1922,1976,1994). It use of agreement between charter party and owner of ship/ Desponent owner of ship for mutual consensus. RIDER CLAUSE-Extra clause adds by the shipping departments in GENCON Call rider. LAYCAN TIME-Period giving by traders to the shipping departments for searching suitable ship/ vessels and confirm the chartering the ship till date so and so and shipping company given the shipping departments to that in between time the ship will arrived this between time call laycan time. T.H.C. terminal handling charges. PRESENT POSITION-it denote that where ship are. LAYTIME- grace period DERRICK- A type of cairn DUNNAGE- in the ship wood /sheet are paved on the surface of ship called dunnage. 89

 PRORATA- @ of S.A.- Safe anchoring S.B.- Safe berth S.P.- Safe port Ship chandlers- Person who supplies the food, water, on the vessels. E.T.A.-Earliest time of anchoring

E.T.B.-Earliest time of berth. E.T.C.- Earliest time of completion E.T.D.- Earliest time of departure P.W.W.D.- Per weather working day S.H.E.X.E.I.U-Saturday holiday excluded even if use. S.H.E.X.U.U.- Saturday holiday excluded use or unless. S.H.I.N.U.- Saturday holiday included F.H.E.X.- Friday holiday excluded (for Muslim/Islamic country) STEVEDORE- Labour working the ship. BERTH-Place where the ship are stand in row. Ready for the loading the cargo.

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RESEARCH METHODOLOGY

The most vital function of management in an organization is to minimize risk and uncertainty through systematic decision-making. Better decision result from the effectively and timely utilization of right information about the consumers, dealers, competitors and others. So for making effective decision research play and important role and provide the right information about consumer, dealers, competitors etc. to the management.In short the search for knowledge trough objective and systematic method of finding solution to a problem is research. Research is a systematic gathering, recording and analyzing of data about problems.

Objective of Study
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To Know about the Pre and Post documents. The procedure of the documents To find out that about of mode of transport are used. To find out about how the shipping is done To find about which kind of documents are requiring To know the reason of the documents. To know various terms is used in the shipping.

Research is of basic, two types (1) (2) Exploratory Descriptive

Exploratory research is a preliminary phase and is absolutely essential in order to obtain a proper definition of problems. The purpose of exploratory research is to determine the general nature of problems and veritable related to it. The major emphasis is on the discovery of ideas and insight. Exploratory research is characterized by flexibility and informality. Exploratory research is generally carried out by three sources (a) Literature (secondary data) 92

(b) (c)

Experience survey (discussion with experts) Study of some specific cases

Descriptive research is used for some specific purposes. It is focus on the accurate description of variables present in the problems. The data is collected in such a manner that the ambiguous nature of causes and effect relationships in the phenomenon is reduced to maximum extent. A descriptive research require a clear specifications of what, who, when, where, why and how aspects of the research. Two types of research is

(a)

Case method

RESEARCH METHODLOGY

Firstly a project on the Shipping documentation with reference to JSW Steel (India) Ltd. was assigned me as a trainee. I have completed my project by going through the following research methodology: 1. Firstly keeping the research objectives mentioned we contacted different managers working in Shivnathrai Harnarain (India) Ltd. in different department.

Data Collection
The Source of the project was secondary data based. 93

 EXIM policy issued by DGFT. www.jsw.in www.export911.com www.indiaindustry.com www.exportindia.com

www.rbi.org

Limitation
Totally secondary based data. Some confidential Data abstract by the company as per the company polices Cost factor. All Documents are not available Time constraint.

SWOT Analysis of the Steel Industry

The SWOT analysis of the steel industry, as per Draft Steel Policy framed by Ministry of Steel, Government of India, is given below:

Strengths Availability of iron ore and coal Low labor wage rates

Weakness Unscientific mining Coking coal import dependence

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Abundance of skilled labor Mature production base Strong managerial capability Modern new plants and modernized old plants

Low R&D investments High cost of debt Inadequate infrastructure High cost of energy Higher duties and taxes

Opportunities Unexplored rural market Growing domestic demand Exports Consolidation Increased interest of foreign steel producers in India Huge infrastructure demand
(Source: National Steel Policy 2008)

Threats China becoming net exporter Protectionism in the west Dumping by competitors Market fluctuations

Conclusion

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Documents formats are easy is compare to other countries documents format. The shipping hiring and the freight forwarder contract process know. For the hiring the vessels, container or the break-bulk process include following common steps are(these steps elaborate in particular section also) a) Get the order from importer and marketing department tell about the importer requirement to the shipping department. b) Shipping department fill enquiry form and send to the various freight forwarders. c) Freight forwarder submit their proposals d) Shipping department evaluate the proposals and chose the freight forwarder and negotiate from them. e) After the negotiation shipping department appoint the C.H.A.(custom house Agent). f) Freight forwarder send the shipment and C.H.A. full fill the Dock and Custom requirement and freight forwarder export the goods. 96

Types of container available for the exporter to export and basic pallets for paved in shipment which are differs as per the L/C, buyers requirement or goods requirements.

The mainly documents requirements are For completing legal requirements. For , knowing the shipment requirements. For fulfill the requirement of importer. For release the payments from the importer. For financing the export and taking the exemption from the Government. For making the goodwill in between the Importers.

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The incoterm are uses in shipping and documentation. The documents require for point of view shipments is Commercial invoice Packing list Insurance Bill of landing (Air, Rail, Ocean) Dock receipts GENCON(in condition of Charter the vessels)

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Suggestions
JSW Steel India Ltd should take time contingency for the bad weather because that for reason some time they have to pay some extra payment o shipping company. The documentation department are not on the same floor so the some problem is faced by the departments so the department should be merged. The electronic system is not applicable in whole process so JSW Steel India Ltd should introduce electric system in whole process. They should regular contract to some vessels and freight forwarders which help them to reduce the price of sending the goods.

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Bibliography
BOOKS:
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 Kothari C.R. Research Methodology (2004) Page No. 1-5, 55-57, 122-151. Publication: New Delhi, New Age International Publishers. Kothari C.R. Research Methodology (2007) Page No. 1-20, Publication: New Delhi, New Age International Publishers. Subba Rao P. International Business (2005) Page No. 2-17, 21-26. Publication: New Delhi, Himalaya Publishing House. NABHIs Exporters Manual and Documentation Page No. 119, 122-136, 242, 256, 271-272, 470, 588, 618, 628, 695, 715, 723734, 740, 779, 1028-1031. Publication: New Delhi, NABHIs Publication.

NEWSPAPER:
Economics times. Export-Import Express. Dainik Bhaskar. Navbhart times. (Above news paper are used between May 10, 2008 to Aug. 10, 2008.)

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WEBSITES:
www.jsw.in www.export911.com www.google.com

www.exportindia.com

Exim policy issued by DGFT. ISO department manuals as per ISO 9001:2000 Norms.

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References
EXIM policy issued by DGFT. www.jsw.in www.export911.com www.googleport.com

www.exportindia.com ISO department manuals as per ISO 9001:2000 Norms C R Kothari, second edition 2004, 2007 research methodology Philip kotler 12th edition 2006 marketing management NABHIs 26th edition 2004 Exporters Manual and Documentation P.Subba Rao. 5th edition 2005 International Business

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