Mergers & Acquisitions In India

PROJECT ON :

"HOW FOREX AND TREASURY OPERATIONS HELP EXPORTS IN

INDIA WITH SPECIAL REFERENCE TO BANK OF BARODA"

Summer Project Submission to:

Bank of Baroda

Project Guide:-

Mr. Narayan Swamy ( Chief Manager,BOB,Fertilizernagar )

Mr. A.G.Joshi ( Chief Manager, IBB,BOB )

Mr. R.P. Agarwal ( Senior Manager, IBB,BOB )

Mr. Laxminarayan Iyer ( Manager, GSFC,Fertilizernagar )

Submitted By :-

Pratik Dave (66)

Full Time PGDBM Student

Class 2007

ITM, Kharghar

Navi Mumbai

ACKNOWLEDGEMENT

First, I would like to thank Institute of Technology Management (ITM), Navi Mumbai and our Respected Director Mr. A.K.Das Biswas for summer internship in PGDBM programme which gives us practical exposure in the real corporate world. I also thank Mr. Pankaj Gupta (Placement Coordinator, ITM) and Prof. Bharat Shah (Project Guide) for providing me constant support and guidance throughout project period.

I also thank Bank of Baroda for giving me opportunity to undertake my project in their prestigious organization and special thanks to Mr.K.K.Joshi (Senior Manager, HRM), Miss.Preetibala Demta (Manager, HRM) and Mrs.Shama Desai.

I express my gratitude to International Business Branch (IBB), Bank of Baroda for providing me training related to my project and sharing their valuable knowledge with me, special word of thanks to Mr.A.G.Joshi (Chief Manger, IBB), Mr.R.P.Aggrawal (Senior Manager, IBB), Mr.Srivasatava (Senior Manager, Imports) and Mr.Tarun Rawal (Manager, Exports).

I express my gratefulness to Bank of Baroda, GSFC Branch and special word of thanks to Mr. Narayan Swamy (Chief Manager, GSFC), Mr.LakshmiNarayanan (Manager-Credit, GSFC), Mr.Rekha Agarwal (Manager- Foreign Exchange Operations, GSFC), and Mr.Milind Pawar for giving me their kind support in gaining the knowledge about forex & treasury operations, providing me their priceless guidance and allotting their precious time for me.

I am also thankful to Mr. Abdul Zariwala (Manager-Accounts, GSFC) for giving me the feedback regarding services provided by Bank of Baroda & helping to understand the concepts of risk management.

I also thank all employees of Bank of Baroda and all other people who directly or indirectly cooperated to make my project a success.

Guide's Certificate

CONTENTS

1 Executive Summary 7

2 Project Outline 9

PART-I How Forex Operations Help Exporters 10

3 Company Introduction 11

3.1 The Heritage 11

3.2 Offices 11

3.3 Key Business Indicators 12

4 Organization of an Authorized Dealer 13

4.1 Organizational Chart of an Authorized Dealer 14

5 Introduction 15

6 International Trade Transaction & Associated Complexities 16

7 Indian Organizations Connected With Export Trade / Finance 17

8 Role of a Bank: 19

9 International Trade Cycle 20

10 Types of Trade Products 21

11 Trade Payment Methods 21

11.1 Advance Remittance 22

11.2 Open Account/Direct Remittance 24

11.3 Consignment Sale 26

11.4 Bill for Collection 27

11.5 Letter of Credit 29

12 Letter of Credit Mechanism 31

13 What is Documentary Credit? 32

14 Meaning and Mechanism of Documentary Credits 33

14.1 Significance of Documentary Credits 33

15 Format of Documentary Credit Message Transfer 35

16 Types of Letter of Credit 36

16.1 Clean Credit 36

16.2 Documentary Credit: 37

16.2.1 Payment, Acceptance & Negotiating Credits 38

16.2.2 Revocable & Irrevocable Credit 40

16.2.3 Confirmed and Unconfirmed Credit 41

16.2.4 With Recourse & Without Recourse Credits 41

16.2.5 Back - to - Back Letter of Credit 42

16.2.6 Transferable Letter of Credit 42

16.2.7 Red Clause Letter of Credit 43

17 Operation of a Letter of Credit 43

17.1 Operative Instrument 43

17.2 Instructions relating to credit 43

17.3 Expiry Dates 44

17.4 Value & Quantity of Goods 44

17.5 Documents to be Tendered 45

17.6 Shipments 45

17.7 Instructions to the Nominated Bank 45

18 Responsibilities & Liabilities of Parties 45

19 Documents Used in Foreign Trade 46

19.1 Financial Documents 46