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           SUMMER TRAINING PROJECT REPORT
                                     ON




“DLW EXPORT PROCEDURE TO NON RAILWAY CUSTOMER”
                          

FOR THE PARTIAL FULFILLMENT OF THE REQUIREMENT
                FOR THE AWARD OF
      POST GRADUATE DIPLOMA IN MANAGEMENT

UNDER THE GUIDANCE OF:                         UNDER THE SUPERVISION OF:
 Prof. Dr. Anamika Pandey                           Mr. N.K Sinha

                          SUBMITTED BY
                         Anand Kumar Tiwari
                       11PGDM/M007 (2011-13)




            Galgotias Business School

(APPROVED BY AICTE, MİNİSTRY OF HRD,
GOVT. OF INDİA) 1,KNOWLEDGE PARK,
   PHASE II, GREATER NOİDA. (U.P.)


                                    1
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                          On company Letter head
                        To whom it may concern

This is to certify that Mr. /Ms. ANAND KUAMR TIWARI, Roll no. 11PGDM/M007 is the student
of PGDM (Mkt.).
He/she has worked on the project titled “DLW EXPORT PROCEDURE TO NON RAILWAY
CUSTOMER” under my supervision and guidance. This is an original and authenticated work done
by him/her.


Guide
Date




                                             2
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                                CERTIFICATE

This is to certify that the project work done on “DLW EXPORT PROCEDURE TO NON
RAILWAY CUSTOMER” is a bonafide work carried out by Mr. /Ms. ANAND KUMAR
TIWARI under my supervision and guidance. The project report is submitted towards the partial
fulfillment of 2 – year, full time Post Graduate Diploma in Management.

This work has not been submitted anywhere else for any other degree/diploma. The original work
was carried during 2011 to 2013 in Diesel Locomotive Works.


Name & Sign of Faculty
Date:




                                              3
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                   ACKNOWLEDGMENT

This Project Report is a combined effort of many people who have contributed in their own ways in
making this report effective and purposeful. In my report, I would like to take the opportunity of
thanking all those who have been instrumental in preparing this report.

Firstly, I would like to thank Prof. Renu Luthra, Director GBS, and Mr. V.K Luthra, Director of CRC
for giving me an Opportunity to carry out this Project.

I would like to thank, Prof. Dr. Anamika Pandey (Mentor) and my seniors who always there to
guide and support me in my endeavor.

I specially wish to thank Mr. N.K Sinha, S.E.E., D.L.W. Varanasi (Diesel Locomotive Works,
Varanasi) for his valuable suggestions & continuous support.

At Last I would like to express my sincere thanks to my parents for being a motivating factor
throughout.

                                                                          ANAND KUMAR TIIWARI

                                                                                  11PGDM/M007




                                                   4
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                                    PREFACE

It gives me great pleasure to put this project report before the concern authorities. This
report is a result of the training, research and experience that I gain during the summer
training at Diesel locomotives works. As a part of my persuasion of PGDM (Mkt). The
topic of my project report is “DLW EXPORT PROCEDURE TO NON RAILWAY
CUSTOMER”

As summer training is an integral part of PGDM (Mkt.) program for the partial fulfillment
of this course. I got opportunity to undertake my summer training in one of the most
prestigious Company in the world Diesel locomotive works. I was assigned many different
task related to General Export Procedure and Documentation works by DLW.

As such I hereby present my projects for evaluation, which gives greater insight in export
procedure of dlw and their other process of maintaining all documents related to Obtaining
Export License, Pre Shipment Inspection, Excise Clearance, Preparation on invoice,
Packaging and forwarding, insurance of goods, Custom Clearance, Payment of Freight &
Insurance of Bill of Lading etc. This is a preliminary effort and need for the
collaborate study initiations of any proposed activity.

This project is based on collection of primary data and Secondary data analysis is done
through interview and discussing with departmental members and survey technique the
data so collected have been used for processing and analysis, which would be of
some use for the organization.



                                                            ANAND KUMAR TIWARI

                                                                         11PGDM/M007




                                          5
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                                         Declaration
I Anand Kumar Tiwari, Roll No. 11PGDM/M007, student of PGDM (Mkt.) of Galgotias Business
School, Greater Noida, hereby declare that my project report on “DLW EXPORT PROCEDURE
TO NON RAILWAY CUSTOMER” is an original and authenticated word done by me.

I further declare that it has not been submitted elsewhere by any person in any of the institutes for
the award of any degree or diploma.




ANAND KUMAR TIWARI

11PGDM/M007




                                                 6
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                 TABLE OF
                 CONTENT
Chapter                                       Page
  No.             Chapters Name                No.

   1             EXECUTIVE SUMMARY             08

   2                INTRODUCTION               10

   3             PROFILE OF COMPANY            20
            •   VISION & MISSION
            •   MANAGEMENT TEAM &
                STRUCTURE
            •   PRODUCTS AND MARKETS

   4             LITERATURE REVIEW             33


            •   MARKETING DEPARTMENT IN
                DLW
            •   EXPORT PROCEDURE IN DLW
            •   ABOUT RITES
            •   SERVICE PROVIDE BY RITES
            •   RITES ROLE IN DLW
            •   CONTRACT BETWEEN RITES &
                DLW
            •   DETAILS     OF    EXPORTED
                LOCOMOTIVES
            •   GENERAL     PROCEDURE    OF
                EXPORT

   5            RESEARCH METHODOLGY            61

   6               DATA ANALYSIS               64

                 FINDINGS AND
   7      CONCLUSION                           67

   8                  RECOMMENDATIONS          70

   9                 LIMITATION                72

  10             LEARNING EXPERIENCE           74


                      7
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  11         BIBLIOGRAPHY   76

  12          ANNEXURE      78




       CHAPTER NO. 1

EXECUTIVE SUMMARY 




              8
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                               EXECUTIVE SUMMARY

The topic of the project is “DLW Export Procedure to Non-Railway Customer”.

Diesel Locomotive Works is a Production Unit of Indian Railways, manufacturing Diesel-electric
Locomotives, Diesel Generating sets and their spares for Indian Railways, Non-Railway
Customers and exports.

This Project has been taken to know about In DLW, How all the activity of EXPORT
PROCEDURE is done by RITES to their Non-Railway Customer. Usually in any Export House
many steps are followed to export, Aim behind this project is know the General Procedure of
Export Trade that are adopt by Diesel Locomotive Works.




The approach of research was survey and instrument used was questionnaire which was filled by
among departmental employees of company. Information gathered through interview and
discussing with departmental members. Primary Data is used.

       After the study based on employee response it has been analyzed the entire employee are
       very well aware and satisfied with the facilities provided by the DLW. The response are
       quite objective in nature.


At Conclusion, Very few improvement but important improvement is needed, which mentioned
above, is needed in welfare programmes, which make the employees more satisfied.




                                              9
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  CHAPTER No. 2

INTRODUCTION




        10
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11
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                                    INTRODUCTION TO PROJECT

Diesel electric locomotives were introduced on Indian Railways in 1950's to exploit their versatility, better
hauling capabilities, low maintenance requirements and overall cost advantage as compared to steam
locomotives. Diesel Locomotive Works (DLW) was established in 1961 in collaboration with M/s ALCO, USA
in the ancient City of Varanasi to undertake indigenous manufacture of diesel electric locomotives for meeting
increasing transportation needs of Indian Railways.

       Over the years, DLW's production has progressively increased and it produced 267 locomotives, in the
year 2011-12 as against 4 locomotives in the first year of its production in 1963-64.

ALCO locomotives are now almost fully indigenous. Through in house development efforts, the original
imported design has been made 7% more fuel-efficient and has also been successfully uprated to deliver about
30% more power, increasing it from 2600 HP to 3300 HP.

DLW is an ISO 9001:2008, ISO 14001:2004 and OHSAS 18001:2007 Certified Organization                  covering
Quality, Environment, Health& Safety Management Systems.




                                                       12
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Integrated Quality, Environment, Health and Safety Policy

Diesel Locomotive Works is a Production Unit of Indian Railways,
manufacturing Diesel Electric Locomotives, Diesel Generating sets and
their spares for Indian Railways, Non – Railway customers and exports.

We are committed to achieve excellence by:

   •   Continual improvement of Quality, Environment, Health and Safety performance at work place
   •   Preventing pollution by all means including minimizing resource consumption and waste generation
       using cleaner technologies, material substitution and process changes
   •   Preventing all injuries and loss of property including environmental performance through continuous
       safety inspections
   •   Striving for compliance with all applicable Environmental and Health & Safety legislations
   •   Striving for " Right first time" and safe working practices through systems improvement and training
   •   Enhancing Customer Satisfaction through improvement in reliability and performance of products
   •   Preventing all employees from occupational diseases and health hazards

We shall:

    Set objectives and       targets, and periodically monitor their progress through internal audit and
       management review
    Communicate Quality, Environment and Health & Safety policy to the employees and to make it
       available to the public on demand.

    Periodically review our Quality, Environment and Health & Safety policy and management systems for
       continuing suitability, adequacy and effectiveness.




                                                      13
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Environment:

Sewage Treatment Plant (STP) :

In-house STP treats domestic and industrial sewage of DLW township and workshop. The treated water is used
for irrigation purpose in DLW township and nearby village farms. The digested sludge is sent to sludge drying
beds, which is later used as manure. Methane gas mainly produced from the digester is collected in the gas
holder and supplied to the canteen.




Industrial Effluent Treatment Plant (IETP):

IETP does the job of treatment of industrial effluent which mainly
contains oil and grease. The treated water is sent to nearby villages for
farming and kitchen gardening at DLW.

Chromium Treatment Plant (CTP):

CTP treats industrial effluent from Chrome Plating Shop. This has
varying concentration of hexavalent chromium. This hexavalent
chromium is converted into trivalent chromium in acidic condition and
is precipitated for safe disposal.




Safety:

Safety of working personnel and of equipment is given prime importance in DLW. In compliance to statutory
requirements all safety aspects are subjected to intensive periodic inspections. Four full time safety officers are
engaged in the entire safety management of DLW including the function of overseeing compliance to all safety
regulations by Workshop personnel.




                                                        14
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Safety Features in DLW Include :


   • Fire fighting arrangements with suitably trained personnel and regular checks of fire hydrants and static
       tanks etc.
   • System of checking/periodic inspection of wire ropes and lifting tackles
   • System of inspecting pressure vessels/air reservoirs
   • Provision of safety Guards on machines and over travel protection of material handling equipments
   • Protection of equipments from short-circuiting
   • Safety awareness training programme for supervisors and workers
   • Periodic maintenance of machinery and plant
   • Mock drills of emergencies for checking of emergency preparedness




Residential Facilities

A total of 3641 staff quarters are provided in a well-maintained township that provides maintained and green,
providing excellent and pollution free environment.




                                                      15
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Educational Facilities

There are 04 schools for Primary and Secondary Education, run by DLW administration where more than 2600
students are being taught. 01 Post Graduate Girl's College also exists in DLW premises. Besides 02 Central
Schools, 01 Sr. Secondary School (Private) and 01 Bal-Niketan (run by DLW Women's Welfare Orgainisation)
are also running in DLW campus.

Medical Facilities

105 bedded well-equipped Railway Hospital, a Health Unit and a
First-Aid post in workshop are functioning, taking comprehensive
health care of around 20,000 employees and their family members.
A Homeopathic and an Ayurvedic dispensary have also been
provided.

Institute/Community Centre etc.

For various social needs of the staff Community Hall, Institutes, Barat Ghars, Kalyan Kendra, Rangshala and
Officer's Club are functioning in DLW township.




Cinema Club

For recreation of the staff a Cinema Hall of around 700 capacity is functioning in DLW Township since 1967.

Games and Sports

Facilities for various games like Cricket, Hockey, Basketball,
Badminton, Volley-ball, Football, Table tennis, Gymnastics, Athletics,
Swimming, Golf, and Rifle Shooting have been provided for the staff.



                                                     16
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World class Swimming-Pool and well-developed Golf course are unique features. Inter Railway Tournaments
are being regularly arranged in DLW premises.



RAILWAY ZONES
Following are the different Zone of Indian Railways and their Headquarters:
NAME OF THE ZONE                            HEADQUARTERS
1. CENTRAL                                     MUMBAI
2. EASTERN                                     CALCUTTA
3. NORTHERN                                    NEW DELHI
4. NORTH-EASTERN                               GORAKHPUR
5. NORTH-EAST FRONTIER                         MALIGAON
6. SOUTHREN                                    CHENNAI
7. SOUTH-EASTERN                               CALCUTTA
8. WESTERN                                     MUMBAI
9. SOUTHERN CENTRAL                           SECUNDERABAD

Recently, six additional zones have been created by regrouping the existing nine zones:
10. NORTH CENTRAL                            ALLAHABAD
11. SOUTH WESTERN                            BANGALORE
12. EAST CENTRAL                              HAJIPUR
13. EAST COAST                               BHUBANESHWAR
14. WEST CENTRAL                              JABALPUR
15. NORTH WESTERN                             JAIPUR
16.SOUTH WEST CENTRAL RAILWAY BILASPUR


 Organizational Set Up:
DLW has a design and development office responsible for all engineering functions related to diesel
locomotives. Equipped with extensive designing tools, this office provides service support to Zonal Railways /
Diesel Locomotive Maintenance Sheds and Locomotive Overhauling Workshops. This office is also responsible
for product development, vendor development and vendor approval. It also performs technical advisory
functions and coordination with RDSO/Railway Board on technical matters.
Chief Design Engineer heads this office and is assisted by a team of technical experts.

Functional Responsibilities:
The functional responsibilities of Design and Development Office are:

Design development of new locomotives, Import substitution /indigenous development of loco component,
multi-sourcing, day-to-day design matters raised by diesel sheds and workshops, liaison with Research Design
and Standards Organisation of Indian Railways, liaison with supply chain partners in respect of technical
matters. Technical matters connected with Loco Standards Committee, Diesel Maintenance Group etc.,
                                                      17
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providing technical clarifications in respect of design/specifications & important tenders. Failure investigations
into major assemblies/critical components.
All design issues for Electrics and Bogie of EMD locomotives. Moreover, design upgradation of EMD
locomotives like power upgradation to 4500 BCV, incorporation of IGBT based technology, Distributed power;
Hotel Load, Development of twin cab WDG4 and development of 12 cylinder 3000 HP EMD locomotives with
AC-DC traction are being dealt with by Design Office.
Liaison with CQAM and RITES in respect of inspection and quality control standards.

Details of Locomotive Exported (up to March'2011)

DLW has exported 105 locomotives to 11 countries. Details are as under:



       S.No.                      Country                        Types of locomotives                 Qty.

         1                         Vietnam                             YDM4, MG                        25

                                 Bangladesh                            YDM4, MG                        10
         2
                                                                       WDM2,BG                         13
         3                        Tanzania                             YDM4, MG                        15
                                  SriLanka                             WDM2, BG                         8
         4
                                                                       12 Cyl., BG                      5

         5                     PCCL, SriLanka                          WDM6, BG                         1

         6                        Myanmar                            YDM4 1350 HP                      11

                                                                  VDM4, 1350 HP, CG                     3
         7                          Sudan
                                                                      2300 HP, CG                       5
         8                           Mali                             2300 HP, MG                       3

                                                                  VDM4, 1350 HP,CG                      1
         9                         Angola
                                                                      2300 HP, CG                       2
        10                        Senegal                              YDM4, MG                         1
        11                        Malaysia                            2300 HP, MG                       1

        11                      Mozambique                       3100 HP, Cape Gauge                    1

                                                                     Total=                           105



                                                       18
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Details of Locomotive supplied to Non Railway Customers (up to March'2011)




DLW has supplied 395 locomotives to Indian NRCs in 2010-2011. Major Non-Railway Customers and
locomotives supplied to them are as under:



       S.No.          Customer's Name          Types of locomotives          Qty.   Total


                                                        WDS6                 180
         1                   SAIL                                                   181
                                                     WDG3A                    1

         2                   VSP                        WDS6                 33      33

                                                        WDS6                 15

         3                  NTPC                        WDM2                 42      88

                                                     WDG3A                   31

                                                        WDS6                 29
         4                Port Trusts                                                36
                                                     WDG3A                    7

                                                        WDM2                 11
         5          State Electricity Boards                                         21
                                                        WDS6                 10

                                                        WDS6                 30

         6                  Others                   WDG3A                    5      36

                                                        YDM4                  1

                                                                Total=              395




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                      OBJECTIVE OF PROJECT
•   To identify who is customer.

•   To understand what is the procedure of export.

•   To understand and analyze the documents needed for better export and documentation.

•   To analyze what is the annual turnover.

       -    The total revenues earned by a company from its normal operations whether good or services.

•   To Find out How far dlw is from their competitors in terms of quality.




                                                     20
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      CHAPTER NO.3

PROFILE OF THE COMPANY




            21
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                           ABOUT COMPANY
                     “DIESEL LOCOMOTIVE WORK”


        Varanasi, one of the oldest populated cities in the world and has a promising place in the international
ground both as a hub of traditions and technology. One side the humming of divine and holy bells of the
temples brings the city to life; on other side Diesel Locomotive Works (DLW) Varanasi is one of the largest
industrial units in eastern part of the nation. DLW catch the attention of lot of foreign tourist students to observe
on going amazing locomotive manufacturing process in Varanasi. Diesel Locomotive works Varanasi is located
at the North end of the city and about 8 Km away from the Holy River Ganges Ghats.
        DLW is an ISO 9002, ISO 14001 & OHS 18001 Certified Organization of diesel electric locomotive.

       Diesel Locomotive Works, Varanasi (DLW) is one of the main manufacturing units run by the Indian
Railways. This manufacturing unit came into existence in year 1961, as a “Green Field Project” in industrial
association with ALCO, USA. This unit generates all the Diesel Electric Locomotives. In year 1964, the first
locomotive was manufactured and it was devoted to the country. Diesel Locomotive Works, Varanasi produces
only Electric Diesel locomotives and auxiliary parts of locomotives.

       Though it is an Indian corporation but it has supplied locomotives to some foreign countries also,
includes Angola, Bangladesh, Malaysia, Myanmar, Sri Lanka, Vietnam, Tanzania, Sudan, Mozambique etc.




Diesel Locomotive manufacturing Works,

Varanasi works in three main sections viz:-
 1) Engine section
 2) Vehicle section and
 3) Block section


1) Engine section manufactures more than 2000 machinery, which comprises of ALCO turbo superchargers,
cylinder heads, connecting rods, camshafts, lubricating oil pumps, chrome plated cylinder liners and many
different types of gears.



                                                         22
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2) Vehicle section of DLW unit works on different fields that include Bogie Manufacturing, Component
Fabrication, Locomotive Assembly, under frame Fabrication, and many more.

      Currently, Diesel Locomotive Works, Varanasi manufactures locomotives , DG sets. In locomotives
section, again it manufactures two different types of products, one is EMD and an other is ALCO.




                                       VISION & MISSION

Vision & Mission


       Our Vision -”To be a world class manufacturer of Diesel - electric locomotives."



       Our Mission - "We shall achieve our vision through Continuous Improvement in the areas of Product
                   Quality, Research and Development, Supplier Partnership, Human Resource Development
                   and Team Work with emphasis on Core Competence leading to Customer Satisfaction and
                 Business Excellence."




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GENERAL INFORMATION


   • Workshop Land                                        219.997 acre

   • Township Area                                        520.6 acre

   • Covered Area in Shop                                 26.37 acre

   • Covered area of other service building               19.13 acre

   • Total No. of Staff Quarters                          3641

   • Total No. of staff on roll (as on March'2012)        5926

   • No. of beds in Hospital                              105

   • Water consumption                                    223.82 Lakh Litres/day


Electrical Power Requirement


   • Electrical Energy Consumption                        262.07 Lakh Unit / Year

   • Workshop                                             4200 KVA

   • Colony                                               2600 KW

   • Administrative Building                              1500 KW

   • Stand by Power Generation Capacity                   5625 KW


MANAGEMENT TEAM

    General Manager- Shri B.P. Khare

    CEE- Shri R.J. Mehrotra

    FA&CAO- Shri Atul Mohan

    COS- Shri S.P Piplani

    CME- Shri Rakesh Vatash

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   CPO- Shir L.B.RAI

   CMS- Dr.Padam Singh

   CE- Shri R.B Yadav

   Secy. to GM/Dy GM- Shivendra Mohan




PRODUCTS AND MARKET

EDM

WDG4 - 4000 HP GOODS LOCOMOTIVE

      Broad Gauge freight traffic Co-Co diesel electric locomotive with 16 Cylinder 4000 HP engine, AC-
AC transmission, microprocessor controlled propulsion and braking with high traction high speed cast steel
trucks.

      First turned out in 1999 with transfer of technology from General Motor (USA), this locomotive has
exceptional fuel efficiency and very low maintenance requirements. It is specifically designed for heavy haul
freight traffic requirements of Indian Railways for the 21st Century.

      The heart of loco Traction Control Converter uses the GTO devices (obsolete technology). Now the
IGBT devices, has been introduced from Oct 2006. It is the latest technology and will be cost effective and
gives higher reliability.

    The locomotive power has been upgraded to 4500 BCV and the first Loco (Loco No 12114) was
manufacturedin May 07




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General Characteristic
   • Installed Power                            •   4000 HP
   •   Axle Load                                •   21 T
   •   Gauge                                    •   1676 mm
   •   Wheel arrangement                        •   Co-Co
   •   Wheel diameter                           •   1092 mm
   •   Height                                   •   4201 mm
   •   Width                                    •   3127 mm
   •   Overall Length (Over Buffer Beam)        •   19964 mm
   •   Weight                                   •   126 T
   •   Max tractive effort                      •   54 T
   •   Maximum speed                            •   100 Kmph
   •   Fuel tank capacity                       •   6000 lts

   •   Locomotive Control                       •   EM 2000 with SIBAS-16 Traction Control




WDG4-4000 HP GOODS LOCOMOTIVE              TRACTIVE EFFORT & POWER CHART




                                           26
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ALCO

2300 HP CAPE GAUGE LOCOMOTIVE




TECHNICAL INFORMATION

2300 HP Main Line Locomotive, having fabricated cape gauge Co-Co bogies. These are provided with two
drivers cabs, one at each end. These locomotives have been supplied to Angola and Sudan.

          Wheel Arrangement                   Co-Co
          sTrack Gauge                        1067 mm Cape Gauge
          Weight                              102 t
          Overall Length                      17620 mm
          Wheel Diameter                      921 mm
          Gear Ratio                          18 : 93
          Maximum Speed                       100 Kmph
          Diesel Engine                       Type: ALCO 251-B 12 Cyl. V- Engine
          HP                                  2300
          Transmission                        Electrical AC/DC
          Brake                               IRAB-1
          Loco                                Air, Dynamic, parking
          Train                               Air
          Fuel Tank Capacity                  3000 Liters




                                                27
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2300 HP METER GAUGE LOCOMOTIVE




TECHNICAL INFORMATION

2300 HP Main Line Locomotive, having fabricated meter gauge Co-Co bogies. These are provided with two
drivers cabs, one at each end. These locos have been supplied to Malaysia, Senegal and Mali.

                Wheel Arrangement             Co-Co
                Track Gauge                   1000 mm Meter Gauge
                Weight                        102 t
                Overall Length                17620 mm
                Wheel Diameter                921 mm
                Gear Ratio                    18 : 93
                Maximum Speed                 100 Kmph
                Diesel Engine                 Type: ALCO 251-B 12 Cyl. V- Engine
                HP                            2300
                Transmission                  Electrical AC/DC
                Brake                         IRAB-1
                Loco                          Air, Dynamic, parking
                Train                         Air
                Fuel Tank Capacity            3000 Liters


                                                 28
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BROAD GAUGE MAIN LINE FREIGHT LOCOMOTIVE
WDG 3A




TECHNICAL INFORMATION

Diesel Electric main line, heavy duty goods service locomotive, with 16 cylinder ALCO engine and AC/DC
traction with micro processor controls.

                 Wheel Arrangement                    Co-Co
                 Track Gauge                          1676 mm
                 Weight                               123 t
                 Length over Buffers                  19132 mm
                 Wheel Diameter                       1092 mm
                 Gear Ratio                           18 : 74
                 Min radius of Curvature              117 m
                 Maximum Speed                        105 Kmph
                 Diesel Engine                        Type : 251 B,16 Cyl.- V
                 HP                                   3100
                 Brake                                IRAB-1
                 Loco                                 Air, Dynamic

                                                 29
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                       Train                                 Air
                       Fuel Tank Capacity                    6000 liters




MARKETING
Marketing Division of DLW provides a single window service to our non-Railway customers. It deals with:

■ Sale of locomotives and spares to Non Railway Customers

■ Supply / Sale of DG sets and spares to Railways and Non Railway Customers

■ Single window services to customers

■ Export of locomotive through intermediaries like RITES and IRCON

■ Availing of credit under MODVAT ( MODIFIED VALUE ADDED TAX) scheme.

   •      MODVAT refers to an excise duty scheme introduced in 1986 for allowing relief to final manufacturers
          on the excise duty borne by their suppliers for goods manufactured by them. It has now been replaced by
          the CENVAT scheme. It applies to certain specific items and is meant to limit the cascading effect of
          duty incidence on a number of goods where the MODVAT credit can be claimed on the purchase of raw
          materials on which excise has been paid. This MODVAT credit can be used to set off the excise duty
          payable on subsequent manufacture of goods.
   •      Settlement of warranty claims and addressing complaints

■ Analysis of failure reports of NRC and Export locomotives and initiation of corrective and preventive
actions

■ Payment of excise duty and CST /VAT on sale of excisable goods and settlement of disputed cases


                                                        30
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Details of Locomotives Exported during last 5 years

                    No of
SN      Period     Export   Horsepower   Gauge    Country
                   Locos

 1     2002-2003     10      2600 HP      BG      Vietnam

 2     2003-2004     3       2600 HP      BG     Bangladesh

                                         Cape
 3     2005-2006     3       1350 HP               Sudan
                                         Gauge

 4     2005-2006     11      1350 HP      MG      Myanmar

                     1       1350 HP               Angola
                                         Cape
 5     2006-2007     2       2300 HP               Angola
                                         Gauge
                     5       2300 HP               Sudan
                     3       2300 HP                Mali
 6     2007-2008                          MG
                     1       2300 HP              Senegal
                                         Cape
 7     2008-2009     1       3000 HP             Mozambique
                                         Gauge

                            31
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                                                      YDM-4
       8          2009-2010          3                             Dan Cross       Mozambique
                                                      6374
                                                      YDM-4          Cape
       9          2010-2011          4                                             Mozambique
                                                                     Gauge
                                                      6706




                                   CHAPTER NO. 4

                  LITERATURE REVIEW
                       Company Background

Diesel Locomotive Works (DLW) is production unit under the ministry of railways. This was setup in
collaboration with American locomotive company (ALCO) USA in 1961 and the first locomotive was rolled

                                                 32
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out in 1964. This unit produces diesel electronic locomotives and DG sets for Indian railways and other
customers in India and Abroad. Subsequently a contract for transfer of technology of 4000 HP Microprocessor
Controlled AC/AC Freight (GT 46 MAC) / passenger (GT 46 PAC) locomotives and family of 710 engines has
been signed with electro motive division of general motors’ of USA for manufacture in DLW. The production
of these locomotives has now started and thus DLW is the only manufacturers of Diesel Electric Locomotives
with both ALCO and General motors’ technologies in the world.




     BRIEF HISTORY OF DLW
     Welcome to Diesel Locomotive Works, Varanasi
     An ISO 9001, ISO 14001 & OHS 18001 Certified Organization.


       August            1961        DLW set up as a green field project in technical collaboration
                                     with ALCO, USA for manufacture of Diesel Electric
                                     Locomotives
       January           1964        First Broad Gauge Locomotive (WDM-2) released by (Late) Shri
                                     Lal Bahadur Shastri. First Locomotive rolled out and dedicated to
                                     the Nation
       November          1968        First Meter Gauge Locomotive (WDM-4) released by (Late) Shri
                                     Morarji Desai.
       February          1975        First Broad Gauge shunting Locomotive (WDS-6) turned out.

       January           1976        First Locomotive rolled out and dedicated to the Nation. Locos
                                     Exported to Tanzania
       December          1977        First Diesel Generating Set commissioned
       May               1984        Locos Exported to Vietnam
       August            1994        First 3100 HP WDM-2C Loco turned out.
       April             1995        First 2300 HP WDP-1 Passenger Loco turned out.
       July              1995        First 3100 HP WDG-2 Freight Loco turned out.
       December          1995        Locos Exported to Sri Lanka.
       April             1996        Locos Exported to Bangladesh.
       February          1997        Awarded ISO-9002 Certification.
       October           1997        Locos Exported to M/s Puttalam Cement Company, Sri Lanka.
       August            1998        First 3100 HP WDP-2C Passenger Loco turned out.
       March             1999        Highest out turn of 161 locos (amounting to 230 units)
       March             1999        4000th Locomotive turned out.
       August            1999        First PKW WDG-4 Locomotive turned out.
       March             2001        Awarded ISO-14001 Certification.
       March             2002        First DLW Built 4000 HP WDG-4 Freight Loco turned out.
       April             2002        First DLW Built 4000 HP WDG-4 Loco turned out.
                                                     33
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June        2002   First DLW Built 3300 HP WDG-3C Freight Loco turned out.
December    2002   DLW certified for ISO: 9001: 14001.
June        2005   2.4MW Diesel Generating set commissioned.
September   2005   Certified by OHSAS- 18001: 1999.
November    2006   First IGBT based WDG-4 Loco turned out.
January     2007   5000th Locomotive turned out.
November    2008   Locos Exported to Mozambique.
March       2009   Highest out turn of 257 locomotive.
November    2009   5690 locomotives up to 30th Nov'2009(including 348 EMD locos)

April       2010   Surpassing target of making 250 engines and Produced 258
                   locomotives.
November    2011   DLW produced 267 locomotives in 2011.

March       2012   DLW has been next given a target of 275 locomotives including
                   215 EMD rail engines.

                      -   The Diesel Locomotive Works (DLW) is all set to
                          produce powerful 5500 HP locomotive and it is expected
                          that the first prototype WDG5 loco come by February
                          2012.
                      -   It will be the most powerful diesel locomotive ever
                          produced by the Indian Railway.




                                 34
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            MARKETING DEPARTMENT
                   IN DLW



Marketing Division was set up at DLW in August 1987 for sales and after sales service of locomotives to Non-
Railway Customers. With the setting of this organization it has been possible to provide single window service
to Non-Railway Customer for all activity connected with sale of locomotives, DG Sets and Spares.
                                                     35
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The marketing Division maintains close liaison with different Non-Railway Customers. The formation of
Marketing Division has greatly helped Non-Railway Customer in improving availability of spares &
maintenance of locomotives.

Marketing Division is also responsible for submitting offers & following up cases of sales of locomotive &
spares to NRCs and Export of locomotive & spares through agencies like RITES and IRCON. It is also the
nodal department at DLW for DG sets.

DLW is registered with Engineering Export Promotion Council & can thus participate in Deemed Export orders
directly and claim export benefits. For export order the demand is met through RITES/IRCON depending on the
country of export.




        Supply of Locomotive & Spares to Non-Railway
                     Customer & Export
During the year 2010-11 DLW has so far received purchase orders of 39 locomotives worth Rs 328.5 crore
from non-railway clients and foreign countries. An export order of 40 locomotives is expected from
Bangladesh.


DLW has so far supplied 395 locomotives to different Non-Railway Customers in India and 105 Locomotives
exported to Countries like TANZANIYA, SRI LANKA, BANGLADESH, VIETNAM, MALAYSIA,
MYANMAR, ANGOLA, SENEGAL, MALI, SUDAN, & MOZAMBIQUE.

In current financial year (2011-12), the DLW has been given a target of 275 locomotives including 215 EMD
rail engines.




                                             SPARES
During the year 2010-11 spares parts worth Rs. 10.61 crore were supplied to Non-Railway Custo mer in India
as well as Export.




                                                    36
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EXPORT PROCEDURE IN DLW




           37
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                      EXPORT PROCEDURE IN DLW




                                         ABOUT RITES
RITES Ltd., a Government of India Enterprise was established in 1974, under the aegis of Indian Railways.
RITES are incorporated in India as a Public Limited Company under the Companies Act, 1956 and are
governed by a Board of Directors which includes persons of eminence from various sectors of engineering and
management.
RITES Ltd., an ISO 9001-2000 company, is a multi-disciplinary consultancy organization in the fields of
transport, infrastructure and related technologies. It provides a comprehensive array of services under a single
roof and believes n transfer of technology to client organizations. In overseas projects, RITES actively pursues
and develops cooperative links with local consultants / firms, as means of maximum utilization of local
resources and as an effective instrument of sharing its expertise.

RITES are internationally recognized as a leading consultant with operational experience of 62 countries in
Africa, South East Asia, Middle East and Latin America. Most of RITES foreign assignments are for National
Governments and other apex organizations.


                                 SERVICES BY RITES
   •   Facilities Planning for Rolling Stock Maintenance
   •   Technical Assistance for Workshop Modernization
   •   Supply & Commissioning of Workshop Machinery and Plant
   •   Supply, Commissioning and Maintenance of Locomotives & Rolling Stock
                                                       38
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   •   Leasing of Locomotives and Passenger Coaches
   •   Supply of Spares
   •   Supply of Signaling Equipment
   •   Rehabilitation of Locomotives and Wagons
   •   Rehabilitation of Traction Machines & Railway Bridges



                               RITES ROLE IN DLW
In DLW, RITES is the representative of Export Division in Marketing Department. Through RITES all the loco
are Exported.
DLW is only the manufacture of loco, but the procedure of sending loco from DLW to another country is done
by RITES Ltd. The conclusion is that all the Procedure of Export is done by RITES Ltd. On the behalf of DLW.
DLW provides free service to NRC and export locomotives up to warranty period and thereafter supplies
spare parts and technical support on payment basis.

For Indian customers DLW directly deals with through marketing wing.

And For export locomotives, DLW deals through RITES ltd.




CONTRACT BETWEEN RITES & DLW
As we know that DLW has done export through RITES ltd. For maintaining this relationship, time to time as
per requirement a contract made, name as BACK TO BACK CONTRACT between both the organizations.

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This contract updates the relationship between RITES & DLW legally. It’s also include the related information
about loco and export procedure for further process




DETAILED OF EXPORTED LOCO IN DLW

       DLW built Locomotives have been successfully exported to all this country as mention above with their
       no. & HP.:


                                      NO. OF
            SN       PERIOD                            HORSEPOWER                COUNTRY
                                     EXPORT

             1       2002-03            10                 1350 HP                 Vietnam
             2       2003-04             3                 2600 HP                Bangladesh
             3       2004-05             3                 1350 HP                  Sudan
             4       2005-06            11                 1350 HP                 Myanmar
                                         1                 1350 HP                  Angola
             5       2006-07             2                 2300 HP                  Angola
                                         5                 2300 HP                  Sudan
                                         3                 2300 HP                   Mali
             6       2007-08
                                         1                 2300 HP                  Senegal

             7       2008-09             1                 3000 HP               Mozambique


             8       2009-10             3                  3000HP               Mozambique


             9       2010-11             4                  3500HP               Mozambique



                                                     40
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 •   At INTERNATIONAL LEVEL the main competitors of DLW (Asia Largest manufacturing of
     Locomotive) are CHINA, JAPAN,



                       GENERAL PROCODURE OF
                             EXPORT


               NOTE: In DLW, all the activity of EXPORT is done by the RITES LTD.


                  GENERAL PROCEDURE OF EXPORT TRADE

Usually in any Export House following steps are followed to export
The goods. These steps are:-


         •   Receipt of Enquiry and sending Quotation.
         •   Receipt of order or indent
         •   Assessing Importer’s credit worthiness and securing a guarantee
         •   Obtaining Export License
         •   Obtaining Pre-finance License
         •   Production or Procurement of goods
         •   Pre Shipment Inspection
         •   Excise Clearance
         •   Obtaining Certificate of Origin
         •   Reservation of shipping space
         •   Preparation of Invoice
         •   Packing and Forwarding
         •   Insurance of Goods
         •   Custom Clearance
         •   Obtaining Mate’s receipt
         •   Payment of Freight & Insurance of Bill of Lading

                                                    41
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           •   Securing Payment


EXPORT PROCEDURE IN SEVERAL STEPS

STAGE 1:       Customer Search and Receiving of Order

This work is assigned to the marketing persons of the company (RITES) they
Establish the relationship with customer. Usually the company gets
The order in three ways:-

      Through Personal Visit:
      Through International Trade Fair & Exhibition
      Through Internet
      Through Global Tender

STAGE 2:       ORDER IMPLEMENTED
Once the order has been received, the export order is scrutinized with reference to the terms and condition of the
export contract. This is the most crucial stage of any export process. All subsequent action and reaction will
depend on the terms and condition of the export contract. It is ensured that contract has been entered into in
accordance with the prevalent export policies of the country and foreign exchange regulations like FERA,
FEMA. The export order must specify the mode of payments such as:
   •   Letter of Credit [L/C]
   •   Documents on Payment [D/P]
   •   Documents against Acceptance [D/A]
In this stage, the Company prepares all the necessary documents including Sales Contract required by the buyer
and submits to the negotiating bank in exact specified format and manner. The most important documents
demanded by the importer are:-
   •   Bill of exchange
   •   Commercial Invoice
   •   Packing List
   •   Marine Insurance Policy
   •   Certificate of Origin
Then Buyer Company sends the Sales Contract which is the declaration by them that all the terms and
conditions of order are accepted to them.

                                                       42
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STAGE 3: PERFORMANCE OF MARKETING DEPT.
As soon as the order has been confirmed the Buyer Company sends the Sales Contract putting their own seal
which is the declaration by them that all the terms and conditions of order are accepted to them.
After the contract, the marketing dept. places the Manufacturing Order on the Production Manager & advice the
Material Procurement. Department for insuring the availibity of purchase item required for the purchase of
Goods.
This note contains the description of the goods as has been given in export order along with the instructions
given by importer.The date by which the goods must be ready is clearly indicated in Manufacturing Order.
On the basis of work order Manufacture start. After receiving MO Production of the goods are started.

STAGE 4: PACKING & SENDING OPTION
Then as per the instructions given by importer goods are packed in Packing Department. Now these packed
goods are sent to shipping agent through transporters or through Courier.

STAGE 5: FINAL INSPECTION
After the stage of inspection, it is carried out by the Quality assurance dept. of DLW & the final inspection is
done by DLW, RITES & IMPORTER (If importer so desire)


                    WORKING OF COMMERCIAL DEPARTMENT
                        i.e. EXPORT DOCUMENTATION
Documentation Department is usually called as ‘Commercial Section’
AT DLW the export is done by the Marketing Dept. up to the stage of Manufacturing & Turning out from DLW
then after the other export formalities are carried out by the RITES.
Commercial Section can be shown by following figure:-


   •   COMMERCIAL SECTION
   •   COMMERCIAL MANAGER
   •   DEPUTY MANAGER
   •   ASSISTANT MANAGER
   •   CLERICAL STAFF & WORKERS


The main function of the commercial section is to prepare and maintain the documents of each and every
activity involved in the Export procedure. Documentation is mainly done to give justification before Reserve
Bank of India of foreign exchange transaction which is carried out in Export Process. Thus, the Export
Documents represents the total Export Procedures.




                                                      43
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Mainly the Export Documents Can be divided into two types:-




(A) COMMERCIAL DOCUMENTS:-

These documents are used by ‘Custom of Trade’ in International Commerce by exporters and importers in
discharge of their respective legal and other incidental formalities under
Sales contract. Commercial Documents can be further divided into two types of documents which are as
follows:-
               1) PRINCIPAL DOCUMENTS.
               2) AUXILLARY DOCUMENTS.

1. PRINCIPAL DOCUMENTS:-
       These documents are required for effective physical transfer of goods and title thereto from exporter to
importer. Following documents come under this category:-
               • Realization of Export Sale Proceeds
               • Commercial Invoice and Invoice prescribed by Importing Country
               • Packing List
               • Certificate of Inspection
               • Certificate of Insurance/Insurance Policy
               • Bill of Lading or Combined Transport Documents
                                                      44
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              •   Certificate of Origin
              •   Bill of exchange
              •   Shipping Advice

2. AUXILIARY DOCUMENTS:-

      These documents are required in connection with preparation or procurement of Principal Export
documents. Following documents are Auxiliary documents:-
             • Proforma Invoice
             • Shipping Instruction
             • Insurance Declaration
             • Intimation for Inspection
             • Shipping Order
             • Mate’s Receipt
             • Application for Certificate of Origin
             • Letter to Bank for negotiation or collection of documents



(B) REGULATORY DOCUMENTS:-
        These documents are prescribed by different Government Department/Bodies for compliance of
formalities under relevant laws, rules and regulations governing export trade viz. FERA ,Import & Export
(control) Act, Central Excise Rules,
Export (Quality Control &Inspection) Act, Customs Act and Major Port Trusts Act etc. Following documents
are of Regulatory nature:
               • Exchange Control Declaration-GR Forms
               • Freight Payment Certificate
               • Insurance Premium Payment Certificate
               • Gate Pass-I/II
               • ARE-1/ CT-1 Forms
               • Shipping Bill/Bill of Export
               • Port Trust Copy of Shipping Bill/ Export Application/ Dock Challan
               • Receipt for Payment of Port Charges
               • Vehicle Ticket

Broadly we can classify the total working of Commercial Section in the three stages. They are:-
   1) Pre Shipment Documentation
   2) Shipment Documentation
   3) Post Shipment Documentation




                                                     45
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           1. PRE-SHIPMENT DOCUMENTATION:

Pre shipment procedure starts from the very beginning i.e. receiving the order and it ends with handling over the
goods to the transporters. In the case of Advance payment following documents come under Pre shipment
documents:-

After receiving the export order, Sales Contract is sent to buyer his is resent by buyer after putting their seal
along with the 30% of total Invoice value (in the case of advance payment) then after packing of goods, Packing
Slip is sent from the Packing Department, with that Slip ,Packing list is prepared in Commercial section.
After checking Packing List thoroughly, Invoice is prepared and then both Packing List as well as Invoice is
sent to buyer to get the remaining 70% of the payment. When they make total payment goods are sent to them.
In this procedure, first of all goods are handled over to the transporter. Then transporter gives whole goods to
Clearing Agent.




           2. SHIPMENT DOCUMENTATION:

  After taking over the whole goods by Clearing Agent, Shipment Procedure is started. If Consignment is going
to be exported by Sea, goods are sent from the company to Mumbai. If goods are to be shipped by Air then
goods are transported to Delhi Airport. Shipping Instruction (3 Copies) is sent to Clearing Agent which contains
the information about consignment. For e.g. Dimension of Cartons i.e. No. and Size of Cases, Detail of items,
Name of Transporter etc.
When goods are loaded on to the Ship/Aero plane Challan is provided by the owner of Ship/Plane. Challan,
Bill of Clearing agent (in the case of FoB), Invoice and ARE (Application for Removable of Excisable goods)
are sent to Buyer.
Terms of Delivery means in delivering the goods to the Buyer which cost will be included whether it will
include only cost of production or it will also include transportation costs. Mainly there are three terms of
Delivery:

       •   FOB (Free on Board):- It is also called as Freight on to-pay Basis that means freight charges will be
           paid by Buyer.


       •   C.I.F. (Cost including Insurance & Freight):- It is also called as Freight on Pre-Paid Basis that
           means Freight charges will be paid by Exporter and Goods will be insured.



       •   C&F (Cost including Freight):- It means only Freight charges will be paid by exporter and
           Insurances charges will be covered by buyer itself.

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         3). POST SHIPMENT DOCUMENTATION:-

Post shipment Documentation start when goods are reached at their destination then to clear the goods from the
customs in the Importer Country some documents are needed. Which are as follows:-

Shipping Advice: - It is sent as covering letter. it contains details of Consignment and clearing agent .
             a). Invoice (2 copies)

              b). Packing List (3 copies)

              c). Bill of Lading (1 original & 1 Xerox)

              d). Airway Bill (1 Xerox & 1 original copy)

                 e). Shipping Bill (Original):- Shipping Bill is provided by Customs of India to the Clearing
       Agent of the Company after checking of goods. Without Clearance of Customs no export can take place.
       It has all the details of Export Order like details of items, Invoice value of total consignment, Foreign
       Currency involved, Exchange Rate, Draw back details, Date of Export etc. This shipping Bill is needed
       at the customs of Importer’s Country as well as Bank of Exporters to get the Payment. It is divided in
       the two sections:


 1. Exchange Control Copy: - First two Pages of Shipping Bill in which Exchange Rates and Freight
    charges, Insurance Charges (if applicable) are indicated, are called exchange control copy.

 2. Export Promotion Copy: - Govt. give export incentive on certain items so, in Shipping Bill all details are
    given regard in Drawback like their rates and amounts.




                                        DOCUMENTS SENT TO BANK:-

               a). Invoice (2 Copies)

               b). Packing List (original)

               c). Exchange Control Copy of Shipping Bill (original)

               d). Bill of Lading (2 Copies)

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               c). Copy of Original FIRC (Foreign Inward Remittance Certificate)


When all the documents are sent to bank, whole transaction is justified and then Bank sends Reference No. with
that Ref. No. Bank Realizations Certificate is made in the Company which is again sent to Bank after 6-8
months Bank sends that Certificate to the Company by putting their own seal. This is the last document in any
Export Order.




               DOCUMENT USED IN PRE-SHIPMENT
   •   SALES CONTRACT
   •   PROFORMA INVOICE
   •   COMMERCIAL INVOICE
   •   MARINE INSURANCE POLICY




                                             SALES CONTRACT

It is a legal contract of exchange of goods, services or property to be exchanged from seller to buyer (in case of
export: from exporter to importer) for a pre-decided value in money or money equivalent paid or promised to
pay same. It is a specific type of legal contract in which all details regarding trade which is going to take place
between any two countries. It contains:-
     • Contract No.
     • Invoice of
     • Delivery Period
     • Date
     • Port of Loading
     • Port of Destination
     • Mode of Payment
     • Exchange Rate
     • Invoice
     • Packing Description
     • Freight Charges
     • Insurance Charges
     • Name of Seller’s Bank
     • Description of Goods


                                                        48
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                                            PROFORMA INVOICE

    A proforma invoice is a very common international document; despite its name, it is not an invoice at all but
a quote. An international transaction includes so many variables that it is sometimes difficult for importer to
have a good grasp of final cost of goods. For e.g. the cost of goods is increased by the cost of shipping,
insurance and so forth. In order to determine these costs the import may request for a proforma invoice which
helps in determining the accurate and precise preview of actual invoice which is usually prepared when a
transaction is going to take place. In those cases when exporter requests payment on a ‘letter of credit basis, the
information contained in proforma invoice is used by issuing bank to open the letter of credit. It contains:-

       •   Name & Address of the Seller
       •   Name & Address of the buyer
       •   Date
       •   Delivery Time
       •   Terms & Conditions
       •   Port of Loading
       •   Port of Discharge
       •   Terms of Trade
       •   Freight to be covered by
       •   Insurance to be covered by
       •   Banker’s Name
       •   Mode of Transport
       •   Currency used
       •   Description of Goods
       •   Signature




                                          COMMERCIAL INVOICE

        Commercial invoice is the basic document in any trade. It is also called ‘document of contents’ because
it generally contains all the information required for preparation of all other documents.
                                                        49
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A commercial invoice is the seller’s bill of merchandise. There is no standard format for commercial invoice
but usually it contains the following:


       •   Exporter’s Name & Address
       •   Invoice No.
       •   Date
       •   Buyer order No.
       •   Consignee Name
       •   Buyer Name and Address
       •   Country of origin of goods
       •   Country of final destination
       •   Terms of Delivery & Payment
       •   Pre Carriage by
       •   Vessel/Flight No.
       •   Port of Loading
       •   Port of Discharge
       •   Final Destination of Goods
       •   Marks & Nos.
       •   Number of Packages
       •   Description of Goods
       •   Container No.
       •   Quantity
       •   Rate
       •   Amount
       •   Declaration
       •   Signature of Authority




                                                    50
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                                      MARINE INSURANCE POLICY


   It provides cover against perils of sea and other connected risks to which goods are exposed to. It is same as
any other insurance and usually done to minimize the risk related to shipment of goods. It contains:-

       •   Certificate No.
       •   Open Cover No.
       •   Open Cover Date
       •   Assured Name
       •   Address of the Assured
       •   Receipt Date
       •   Effective From
       •   Issued at
       •   Net Premium
       •   Name of the Issuing Company
       •   Total Sum insured
       •   Sum Insured in Foreign Currency
       •   Basis of Valuation
       •   Country of Destination
       •   Mode of Transport
       •   Packaging Description
       •   Commodity Description
       •   Terms of Insurance




                    DOCUMENT USED IN SHIPMENT
                                                       51
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   •   PACKING LIST
   •   CERTIFICATE OF ORIGIN
   •   CERTIFICATE OF INSPECTION
   •   MATE’S RECEIPT
   •   BILL OF LADING




                                                  PACKING LIST


It is a document which shows nature and the number of goods etc.put in each package/container with distinctive
number of marks. This is generally needed by the importer when he is importing different types or sizes of
merchandise so that he may identify the nature of goods in each package. It is also used by custom for checking
the goods on random basis or otherwise.
Thus, packing list is mainly used to facilitate easy identification of goods in each package/container by the
importer or custom. It generally contains:-

       •   Exporter’s Name & Address
       •   Invoice No.
       •   Date
       •   Buyer order No.
       •   Consignee Name
       •   Buyer Name and Address
       •   Country of origin of good
       •   Country of final destination
       •   Terms of Delivery & Payment
       •   Pre Carriage by
       •   Vessel/Flight No.
       •   Port of Loading
       •   Port of Discharge
       •   Final Destination of Good
       •   Marks & Nos.
       •   Container No.
       •   No. & Kind of Packages
       •   Description of Goods
       •   Quantity of Goods
       •   Remarks, if any


                                                      52
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                                        CERTIFICATE OF ORIGIN


This is a document which is mostly required by Common wealth Countries. It is a certificate of declaration by
the shipper regarding origin of goods. The certificate is generally attested or certified by the Chamber of
Commerce for industry or other agency designated for this purpose. The main aim of this certificate is to enable
the importer to get concessional tariffs.
It contains:-
        • Exporter’s business Name, Address & country
        • Consignee’s Name, Address & country
        • Means of Transport & Route
        • Item No.
        • Marks & Nos. of Packages
        • No. & Kind of Packages, description of goods
        • Origin of country
        • Gross Weight & other quantity
        • No. & Date of Invoices
        • Certification & Signature by Chamber of Commerce
        • Declaration & Signature by Exporter




                                     CERTIFICATE OF INSPECTION

For ensuring the quality government has made it compulsory for certain products that these should be inspected
by some authorized agency. EXPORT INSPECTION COUNCIL OF INDIA (EICI) is one such agency which
carries out such inspections and issues the certificate that the consignment has been inspected as required under
the Export Quality Control and Inspection Act, 1963 and satisfies the conditions relating to quality control and
inspections as applicable to it and is export worthy. Some countries have made it mandatory for the goods being
imported to their countries
It contains:-

       •   Beneficiary Name & Address
       •   Applicant
       •   Description of the Goods
       •   Bill of Lading quantity
       •   For Transportation to

                                                       53
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       •   Remarks
       •   Item wise/Size wise Break up of Quantity




                                             MATE’S RECEIPT

It is issued by the chief of vessel after cargo is loaded and it is duly signed and stamped by Chief Officer or
Master of vessel. The shipping company does not issue the bill of lading unless it receives the Mate’s receipt.
It contains:-

       •   Mate Receipt No.
       •   Shipping Bill No.
       •   Date
       •   Voyage
       •   Exporter’s Name
       •   CHA Name
       •   Marks
       •   Quantity of Goods
       •   Description of Goods
       •   Cargo Weight
       •   Consignee Name
       •   Terminal or Chief Officer signature

                                             BILL OF LADING

The Bill of Lading is a document issued by the shipping company or the agent acknowledging the receipt
mentioned in the bill for shipment on board of vessel and undertaking to deliver the goods as per the order and
condition as received by the consignee or according to his order. The Bill of Lading is issued in standardized
aligned document format.
It contains:-

       •   Shipper’s Name
       •   Consignee
       •   Notifying Party

                                                      54
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       •   Pre Carriage by
       •   Place of Receipt by Pre Carrier
       •   Ocean Vessel
       •   Port of Loading
       •   Port of Discharge
       •   Marks & Nos.
       •   No. of Packages or Units
       •   Kind of Packages, description of Goods
       •   Weight of Goods




                      POST SHIPMENT DOCUMENT

   •   SHIPPING BILL
   •   BILL OF EXCHANGE
   •   CONSULAR INVOICE
   •   BANK CERTIFICATE OF EXPORT & REALISATION



                                             SHIPPING BILL

The shipping bill is the main document on the basis of which customs office grants the permission for export.
After loading the goods on ship it is prepared by clearing agent but it is mainly needed to justify the goods
going to be exported.
It contains:-
        • CHA Name
        • Date
        • State of Origin
        • Exporter’s Details
        • Consignee
        • Port of Loading
        • Port of Discharge
        • Gross Weight
        • Total Packages
        • Net Weight
        • Country of Destination
        • Nature of Cargo
        • Marks & Nos.
                                                     55
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       •   Foreign Exchange Bank A/C No.
       •   RBI Waiver No.
       •   Invoice Details
       •   Exchange Rate
       •   Insurance Charges
       •   Freight Charges
       •   Discount
       •   Commission
       •   Packing Charges
       •   Draw Back Description
       •   Nature of Payment
       •   Buyer Name & Address

                                           BILL OF EXCHANGE

It is a written instrument whereby the person issuing it directs the other party to pay a specified amount to a
certain person or to bearer of the instrument i.e. bill of exchange.
In the context of an export-import transaction, bill of exchange is drawn by the exporter. According to which
importer are to pay a certain amount to a certain person or to the bearer of bill of exchange. Export consignment
is passed on to the importer only when the importer’s order contains bill of exchange.
It contains:-

       •   Amount of bill
       •   Place
       •   Name & Address of the Bank in which amount is to be paid
       •   Order by exporter
       •   Invoice No.
       •   Name & Address of the import
       •   Exporter’s Signature




                         BANK CERTIFICATE OF EXPORT & REALISATION

        This certificate contains the information of export consignment and as to be submitted to the bank for
each and every consignment.
The information required for making bank certificate is obtained by various shipment documents named as
Invoice, Shipping Bill, Bill of Lading, Airway bill, Insurance bill, Freight Memo etc Three copies of ‘bank
certificate’ addressed to the “JOINT
 DIRECTOR OF FOREIGN TRADE” is prepared and submitted to bank. Copies of Export Invoice, custom
attested EP (Export Promotion) copy of Shipping Bill and other relevant documents are also submitted along
with the Bank Certificate
                                                       56
`
The Bank Certificate is declaration by the exporter that they have forwarded the documentary export bill to its
bank for the collection or negotiation or purchase as per particular given in Bank Certificate. The bank verifies
the information given by the exporter and certifies the same. The bank passes the original copy with the relevant
copy of attested documents to the exporter and duplicate copy to the Licensing Authority. Bank retains the
triplicate copy for its record.
It contains:-

       •   Invoice No.
       •   Export Promotion Copy of Shipping Bill duly-authenticated by custom
       •   Description of Goods as given in Custom Authenticated-Shipping Bill
       •   Bill of Lading No.
       •   Destination of Goods
       •   Bill Amount
       •   Foreign Exchange used
       •   Freight Amount as per Bill of Lading
       •   Insurance amount as per Bill receipt
       •   Date of Realization of export proceeds
       •   SDF (Sales Declaration Form) Form No. & Signature of Exporter




                                           MODES OF PAYMENT

   There is a no. of different payment methods that can be used when importer deals with exporter. Mostly
   three of them are used. Which are as follows?
        DOCUMENTS AGAINST PAYMENT
        LETTER OF CREDIT




                            DOCUMENTS AGAINST PAYMENT

The exporter makes the shipment and sends the shipping documents to the exporter’s bank for collection. The
bank then sends the shipping documents along with a collection letter to the importer’s bank, which then sends
                                                       57
`
a collection notice to the importer. The importer makes payment upon receiving the notice, and only after
payment the importer receive the original shipping documents with which they take the physical possession of
the goods.
The major advantage of the use of DP is the low cost as compared to use a Letter of Credit. But this is offset by
the risk that the importers sometimes reject the documents for some reasons (or when they are not in
order).Since the cargo has already been loaded (to generate the documents) exporters have little recourse against
the importer in case of non-payment. So a document against payment (DP) arrangement involves a high level of
trust between the exporters and importers.




                                            LETTER OF CREDIT

A Letter of credit is very common and familiar document in setting payment between buyer and seller. It is a
signed instrument embodying an undertaking by the bank of the buyer to pay the seller a certain sum of money
on presentation of documents evidencing shipment of specified goods and subject to compliance with stipulated
terms and conditions. The International Chamber of Commerce (ICC) has a published a set of universal
recognized guidelines governing the issue of a Letter of Credit in Uniform Custom and Practice of
Documentary Credit (UCPDC).
Following parties are involved in issuing a letter of credit:-

   1. APPLICANT: - The firm asking for a Letter of Credit is applicant. Usually the applicant is importer
      who is going to import goods but it is not in position to pay for the goods currently.

   2. BENEFICIARY: - The firm named in a letter of credit as the firm to whom the bank is insuring
      payment if the importer does not pay. Usually, the beneficiary of a letter of credit is the exporter.


   3. ISSUING BANK: - It is that bank which provides the letter of credit to the importer. It has the
      contractual obligation to pay the beneficiary (exporter) on the presentation of necessary documents by
      them when importer is unable to pay.

   4. ADVISING BANK: - In a Letter of Credit transaction, the bank that determines whether the issuing
      bank is a legitimate bank and the terms of the Letter of Credit offered by the issuing bank on behalf of
      the importer are appropriate. Generally, the advising bank is the exporter’s regular bank. But in some
      cases the exporter’s bank will delegate this role to another bank which is more experienced.




                                                       58
`




                                    LETTER OF CREDIT
                                  (PAYMENT PROCEDURE)

The Letter of Credit (L/C) payment procedure is usually as follows:-

   •   The Importer applies to open the L/C to exporter through A bank that can open the L/C in their
       country.

   •   The opening Bank will inform the exporter that L/C has been established.

   •   Exporter checks all the terms and conditions listed in the L/C. If all the terms and conditions are
       acceptable the will arrange the shipment within the time specified in the Letter of Credit.

   •   After the goods are loaded onto the ship without any damage, the captain of the ship will issue
       clean Bill of Lading to the exporter. With clean Bill of Lading only they can claim the ownership
       of goods.

   •   Clean Bill of Lading and other relevant documents will be submitted to their bank to gather the
       irrevocable Letter of Credit. It is an often used payment method. This is a formal payment
       method that offers a lot of protection to the parties. In simple words, a Letter of Credit is a letter
       written by the importer’s bank to the exporter. It verifies that the payment will be guaranteed
       when bank is presented with concrete documents (Bill of Lading, Freight documents etc.).
       Mostly Letters Of Credit are irrevocable once the importer has sent them.

   •   A Letter of Credit usually includes applicant (the importer), beneficiary (I/E agent), opening
       bank, negotiating bank, specification and quantity of the goods, amount of money, loading port
       and destination port, shipment date, the validity date of the L/C, terms and conditions agreed by
       both the importer and exporter and details of the documents required by the importers (Bill of
       Exchange, Commercial Invoice, Packing List, Insurance Certificate etc.)

                                                59
`
           •   The exporter’s bank will send the clean Bill of Lading and relevant documents to opening bank.

           •   Opening bank will inform them that all documents are received.

           •   Then importer will go to the bank to make the payment to get the clear Bill of Lading and
               relevant documents.

           •   With all of these documents, they can clear the import customs and pick up the goods after the
               goods have arrived on the destination sea port.

           •   L/C is used for the larger quantity order shipped by the sea.

           •   The typical L/C scenario takes 14-21 days to complete.


                           STEPS IN PROCESSING OF A LETTER OF CREDIT

The main steps in the processing of a Letter of Credit are as follows:-
   ◊ Issuance of a Letter of Credit
   ◊ Shipment under a Letter of Credit
   ◊ Payment under a Letter of Credit


                   1. ISSUANCE OF A LETTER OF CREDIT:-

We can understand the first and foremost step of processing of a Letter of Credit with the help of following
diagram:-


     EXPORTER’S BANK                                         IMPORTER’S BANK




           EXPORTER                                                IMPORTER

   a. First of all the exporter and the importer agree on a sale under “Letter Of Credit” terms. The exporter
      sends a proforma invoice to importer.

   b. Then importer takes the proforma invoice to its bank and requests for a Letter of Credit.

   c. The importer’s bank issues a Letter of Credit and sends it to the exporter’s bank.


                                                        60
`

d. The exporter’s bank receives and revises the Letter of Credit. Then it notifies the exporter that it is ready
   to ship the merchandise to the importer.




               2.   SHIPMENT UNDER A LETTER OF CREDIT:-



      EXPORTER’S BANK                                        IMPORTER’S BANK




               EXPORTER                                             IMPORTER

a. The exporter sends the merchandise to the importer but gathers all the documents and sends them to the
   exporter’s bank.

b. The exporter’s bank checks that whether the documents fulfill the requirement of Letter of Credit or not
   and then sends them to the importer’s bank.

c. The importer’s bank also verifies the documents that they match with the requirement of Letter of Credit
   and notifies the importer that everything is in order.




          3.        PAYMENT UNDER A LETTER OF CREDIT:



        EXPORTER’S BANK                                   IMPORETR’S BANK


                                                    61
`




               EXPORTER                                       IMPORTER

a. The importer pays the importer’s bank in order to collect the documents that will be needed to collect
   the merchandise and clear the customs.

b. The importer’s bank sends the importer’s payment to exporter’s bank.

c. The exporter’s bank notifies the exporter that they have been paid by importer.




                            CHAPTER NO. 5

              RESEARCH METHODOLOGY




                                                  62
`




The project on Dlw Export procedure to Non-Railway Customer is based on Two Researches.
1). Exploratory research design &
2). Conclusive research design.
The approach of research was survey and instrument used was questionnaire for quantifying whether the

organization employees are very well aware and satisfied with the facilities provided by the DLW.
       Before going through the questionnaire first one should understand the meaning of the terms used in the
project for better understanding of the project report. These are exploratory research and conclusive research,
sampling plan and reliability of the questionnaire.


WHAT IS EXPLORATORY RESEARCH?
Investigation into a problem or situation which provides insights to the researcher. The research is meant to
provide details where a small amount of information exists. It may use a variety of methods such as trial studies,
interviews, group discussions, experiments, or other tactics for the purpose of gaining information.




WHAT IS CONCLUSIVE RESEARCH?
conclusive research is meant to provide information that is useful in reaching conclusions or decision-making.
It tends to be quantitative in nature, that is to say in the form of numbers that can be quantified and
summarized. It relies on both secondary data, particularly existing databases that are reanalyzed to shed light



                                                       63
`
on a different problem than the original one for which they were constituted, and primary research , or data
specifically gathered for the current study.


WHAT IS SAMPLE?

Sample is defined as subgroup of elements of the population selected for participation in the study. Sample
characteristics, called Statistics, are then used to make inferences about the population parameters



SAMPLING PLAN;
There is no sampling plan as such as the study involved in understanding the various processes and analyzing
them. The study involved in the detail analysis of secondary data gather from various sources and there for no
sample size and plan has been considered.




                                      Type of the Data

Sources of data: Data has been collected through literature survey and expert opinion. The part of data is
collected from various primary sources and secondary sources.



   •   Primary Data Sources – Information gathered through interview and discussing with departmental
                              Members.

   •   Secondary Data Sources – Past Data

   •   Type of Research – Exploratory & Conclusive Analysis

   •   Type of Sampling plan – No Sampling plan

   -   There is no sampling plan as such as the study involved in understanding the various processes and
       analyzing them. The study involved in the detail analysis of secondary data gather from various sources
       and there for no sample size and plan has been considered.




                                                       64
`




  CHAPTER NO. 6


DATA  ANALYSIS
         65
`




LOCOMOTIVE PRODUCTION
Varieties of management interventions, active co-operation of employees, and their high level of motivation
enabled DLW to increase its output significantly in the current decade. This is depicted below:


                                    Locomotive Out Turn
                                                         EMD
                                                         ALCO
                 30
                  0
                                                                                     39           59    80
                 25
                                                                                    218           199   187
                  0

                                                               15         22
   No. of        20
                                                             147         200
 Locomotive       0

                                                   24
                 15
                                                  126
                  0

                                        20

                                                        66
`
              10
                                106
               0

                        3
              50       92

               0 2003-04    2004-05   2005-06    2006-07   2007-08   2008-09   2009-10   2010-11
                                           YEAR



•   In the last financial year (2010-11), DLW has produced 267 locomotives (including 150 HHP EMD
    locomotives) .




                                                67
`


TYPE WISE LOCOMOTIVE OUT-TURN

                          2007-08                  2008-09             2009-10              2010-11
         Type of
                     Targets Actual         Targets     Actual   Targets     Actual   Targets   Actual
          Loco
          ALCO           138    148             148      157      168         175      148        167

           GM            62      59             80       80        62         59        80        80

        EXPORT            4         4             0          1     4             4      0             1

           NRC           16      20             22       19        16         20        22        19

           Total         220    222             250      257      250         258      250        267
 •   In current financial year (2011-12), the DLW has been given a target of 275 locomotives including 215
     EMD rail engines.


TURNOVER

                                         Year                    Rs. in crores


                                    2003- 04                           558

                                    2004 – 05                       855.88

                                    2005 – 06                       934.65

                                    2006 – 07                       872.05

                                    2007 – 08                       984.65

                                    2008 – 09                      1297.54

                                        2009-10                    1560.28

                                        2010-11                    2404.38


                                                        68
`




       CHAPTER NO. 7



FINDING AND CONCLUSION




             69
`


 After completing my project I familiarize with DLW, and I get that diesel locomotive works is a famous
technological temple, which came in existence, in 1964 by Late Shri Lal Bahadur Shastri. DLW export to the
following countries like Sri Lanka, Bangladesh, Angola, Tanzania, Vietnam,Sengal Mozambique,
Malaysia, Sudan, Myanmar etc.
There are many facilities for the employees as hospital, health club, sports club, school and college, sewing
center, technical training center etc. In short we can say that all the facility which the ordinary employee needed
is provided by welfare department and the entire employee are very well aware with welfare programmes. They
take advantage with programme in any form. Very few improvement but important improvement, which
mentioned above, is needed in welfare programmes, which make the employees more satisfied.




                                                        70
`




       FINDINGS :

       The above study helps to identify the positive and negatives of DLW, Varanasi. This is the major key
area the employees got benefited directly through direct & indirect way..
       Although company is doing good at their business, as we can analysed from the above interpretation that
           •   Locomotive turn out is constantly increasing.
           •   Company is able to achieve its target
           •   And if we compare the the actual turnover in year 2003-2004 i.e. 558 with 2010-2011 i.e.
               2024.38 which is more than double.
It shows that company is in its growth stage.
But on the other hand, during this study I found few negative points which I personally will that company
should rectify for the effective production system.




   •   The major problem that I found was Ineffective utilization of resources Company’s input are more
       than requirement, employees were wasting spare parts of mass production , and no one was their to take
       care of it, which may cause loss to company in near future.
   •   Excess wastage of raw material during transfer from one place to another.
   •   Absence of proper supply of required equipments, due to which company facing high lead time and turn
       up time.
   •   They don’t have product inception process, during transportation or warehousing. Which me cause
       question to their quality.
   •   There was no proper schedule for employees, they were not sincere during work hours.
   •   Employees were not cooperative and absence of proper coordination of work.




       So, the company takes this study to rectify the problems in few above given areas areas due to which
       production process get effected, So that company can play more better in upcoming future.
                                                       71
`




    CHAPTER NO. 8

RECOMMENDATIONS




            72
`




 As I work n my project report. I feel that DLW is very prosperous and the facilities provided to their
employees here are very much satisfactory. But some suggestions.

Which in want to give are as follows?

   1) The standard of hospital should he tried to improve.

   2) Medical store facility should he provided in the campus of the hospital with large stock of medicine.

   4) If lunch provided in DLW canteen it will also motives employees.

   5) The crèche should also be provided by DLW welfare Department.


   6) Welfare department should motivate the employees in such a manner that employee’s female member
      most participate in women welfare programme.

   7) The number of member of sports club and health club is very low so it can increase by the efforts of
      welfare officers of DLW.


   8) Always there should be good communication between welfare.

   9) Department and employees.


   10) All employees should be motivated to part in cultural programmes.




                                                      73
`




  CHAPTER NO. 9


LIMITATIONS




       74
`




 There is the possibility of ambiguous replies from the respondents which can give untrue or misleading
  result.

 Few people did not have the time to fill up or answer the Questionnaire.

 The responses are quite objective in nature.

 There was low rate of return of the dully filled in questionnaire due to the biasness of the respondents.

 Few people were not responding as expected from them and they were considering survey a useless
  activity.




                                                   75
`




    CHAPTER NO. 10

LEARNING EXPERIENCE




           76
A project report on dlw export procedure to non railway customer by anand kumar tiwari '11 pgdm m007'
A project report on dlw export procedure to non railway customer by anand kumar tiwari '11 pgdm m007'
A project report on dlw export procedure to non railway customer by anand kumar tiwari '11 pgdm m007'
A project report on dlw export procedure to non railway customer by anand kumar tiwari '11 pgdm m007'
A project report on dlw export procedure to non railway customer by anand kumar tiwari '11 pgdm m007'
A project report on dlw export procedure to non railway customer by anand kumar tiwari '11 pgdm m007'
A project report on dlw export procedure to non railway customer by anand kumar tiwari '11 pgdm m007'

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A project report on dlw export procedure to non railway customer by anand kumar tiwari '11 pgdm m007'

  • 1. `            SUMMER TRAINING PROJECT REPORT ON “DLW EXPORT PROCEDURE TO NON RAILWAY CUSTOMER”                            FOR THE PARTIAL FULFILLMENT OF THE REQUIREMENT FOR THE AWARD OF POST GRADUATE DIPLOMA IN MANAGEMENT UNDER THE GUIDANCE OF: UNDER THE SUPERVISION OF: Prof. Dr. Anamika Pandey Mr. N.K Sinha SUBMITTED BY Anand Kumar Tiwari 11PGDM/M007 (2011-13) Galgotias Business School (APPROVED BY AICTE, MİNİSTRY OF HRD, GOVT. OF INDİA) 1,KNOWLEDGE PARK, PHASE II, GREATER NOİDA. (U.P.) 1
  • 2. ` On company Letter head To whom it may concern This is to certify that Mr. /Ms. ANAND KUAMR TIWARI, Roll no. 11PGDM/M007 is the student of PGDM (Mkt.). He/she has worked on the project titled “DLW EXPORT PROCEDURE TO NON RAILWAY CUSTOMER” under my supervision and guidance. This is an original and authenticated work done by him/her. Guide Date 2
  • 3. ` CERTIFICATE This is to certify that the project work done on “DLW EXPORT PROCEDURE TO NON RAILWAY CUSTOMER” is a bonafide work carried out by Mr. /Ms. ANAND KUMAR TIWARI under my supervision and guidance. The project report is submitted towards the partial fulfillment of 2 – year, full time Post Graduate Diploma in Management. This work has not been submitted anywhere else for any other degree/diploma. The original work was carried during 2011 to 2013 in Diesel Locomotive Works. Name & Sign of Faculty Date: 3
  • 4. `                                        ACKNOWLEDGMENT This Project Report is a combined effort of many people who have contributed in their own ways in making this report effective and purposeful. In my report, I would like to take the opportunity of thanking all those who have been instrumental in preparing this report. Firstly, I would like to thank Prof. Renu Luthra, Director GBS, and Mr. V.K Luthra, Director of CRC for giving me an Opportunity to carry out this Project. I would like to thank, Prof. Dr. Anamika Pandey (Mentor) and my seniors who always there to guide and support me in my endeavor. I specially wish to thank Mr. N.K Sinha, S.E.E., D.L.W. Varanasi (Diesel Locomotive Works, Varanasi) for his valuable suggestions & continuous support. At Last I would like to express my sincere thanks to my parents for being a motivating factor throughout. ANAND KUMAR TIIWARI 11PGDM/M007 4
  • 5. ` PREFACE It gives me great pleasure to put this project report before the concern authorities. This report is a result of the training, research and experience that I gain during the summer training at Diesel locomotives works. As a part of my persuasion of PGDM (Mkt). The topic of my project report is “DLW EXPORT PROCEDURE TO NON RAILWAY CUSTOMER” As summer training is an integral part of PGDM (Mkt.) program for the partial fulfillment of this course. I got opportunity to undertake my summer training in one of the most prestigious Company in the world Diesel locomotive works. I was assigned many different task related to General Export Procedure and Documentation works by DLW. As such I hereby present my projects for evaluation, which gives greater insight in export procedure of dlw and their other process of maintaining all documents related to Obtaining Export License, Pre Shipment Inspection, Excise Clearance, Preparation on invoice, Packaging and forwarding, insurance of goods, Custom Clearance, Payment of Freight & Insurance of Bill of Lading etc. This is a preliminary effort and need for the collaborate study initiations of any proposed activity. This project is based on collection of primary data and Secondary data analysis is done through interview and discussing with departmental members and survey technique the data so collected have been used for processing and analysis, which would be of some use for the organization. ANAND KUMAR TIWARI 11PGDM/M007 5
  • 6. ` Declaration I Anand Kumar Tiwari, Roll No. 11PGDM/M007, student of PGDM (Mkt.) of Galgotias Business School, Greater Noida, hereby declare that my project report on “DLW EXPORT PROCEDURE TO NON RAILWAY CUSTOMER” is an original and authenticated word done by me. I further declare that it has not been submitted elsewhere by any person in any of the institutes for the award of any degree or diploma. ANAND KUMAR TIWARI 11PGDM/M007 6
  • 7. ` TABLE OF CONTENT Chapter Page No. Chapters Name No. 1 EXECUTIVE SUMMARY 08 2 INTRODUCTION 10 3 PROFILE OF COMPANY 20 • VISION & MISSION • MANAGEMENT TEAM & STRUCTURE • PRODUCTS AND MARKETS 4 LITERATURE REVIEW 33 • MARKETING DEPARTMENT IN DLW • EXPORT PROCEDURE IN DLW • ABOUT RITES • SERVICE PROVIDE BY RITES • RITES ROLE IN DLW • CONTRACT BETWEEN RITES & DLW • DETAILS OF EXPORTED LOCOMOTIVES • GENERAL PROCEDURE OF EXPORT 5 RESEARCH METHODOLGY 61 6 DATA ANALYSIS 64 FINDINGS AND 7 CONCLUSION 67 8 RECOMMENDATIONS 70 9 LIMITATION 72 10 LEARNING EXPERIENCE 74 7
  • 8. ` 11 BIBLIOGRAPHY 76 12 ANNEXURE 78 CHAPTER NO. 1 EXECUTIVE SUMMARY  8
  • 9. ` EXECUTIVE SUMMARY The topic of the project is “DLW Export Procedure to Non-Railway Customer”. Diesel Locomotive Works is a Production Unit of Indian Railways, manufacturing Diesel-electric Locomotives, Diesel Generating sets and their spares for Indian Railways, Non-Railway Customers and exports. This Project has been taken to know about In DLW, How all the activity of EXPORT PROCEDURE is done by RITES to their Non-Railway Customer. Usually in any Export House many steps are followed to export, Aim behind this project is know the General Procedure of Export Trade that are adopt by Diesel Locomotive Works. The approach of research was survey and instrument used was questionnaire which was filled by among departmental employees of company. Information gathered through interview and discussing with departmental members. Primary Data is used. After the study based on employee response it has been analyzed the entire employee are very well aware and satisfied with the facilities provided by the DLW. The response are quite objective in nature. At Conclusion, Very few improvement but important improvement is needed, which mentioned above, is needed in welfare programmes, which make the employees more satisfied. 9
  • 10. ` CHAPTER No. 2 INTRODUCTION 10
  • 11. ` 11
  • 12. ` INTRODUCTION TO PROJECT Diesel electric locomotives were introduced on Indian Railways in 1950's to exploit their versatility, better hauling capabilities, low maintenance requirements and overall cost advantage as compared to steam locomotives. Diesel Locomotive Works (DLW) was established in 1961 in collaboration with M/s ALCO, USA in the ancient City of Varanasi to undertake indigenous manufacture of diesel electric locomotives for meeting increasing transportation needs of Indian Railways. Over the years, DLW's production has progressively increased and it produced 267 locomotives, in the year 2011-12 as against 4 locomotives in the first year of its production in 1963-64. ALCO locomotives are now almost fully indigenous. Through in house development efforts, the original imported design has been made 7% more fuel-efficient and has also been successfully uprated to deliver about 30% more power, increasing it from 2600 HP to 3300 HP. DLW is an ISO 9001:2008, ISO 14001:2004 and OHSAS 18001:2007 Certified Organization covering Quality, Environment, Health& Safety Management Systems. 12
  • 13. ` Integrated Quality, Environment, Health and Safety Policy Diesel Locomotive Works is a Production Unit of Indian Railways, manufacturing Diesel Electric Locomotives, Diesel Generating sets and their spares for Indian Railways, Non – Railway customers and exports. We are committed to achieve excellence by: • Continual improvement of Quality, Environment, Health and Safety performance at work place • Preventing pollution by all means including minimizing resource consumption and waste generation using cleaner technologies, material substitution and process changes • Preventing all injuries and loss of property including environmental performance through continuous safety inspections • Striving for compliance with all applicable Environmental and Health & Safety legislations • Striving for " Right first time" and safe working practices through systems improvement and training • Enhancing Customer Satisfaction through improvement in reliability and performance of products • Preventing all employees from occupational diseases and health hazards We shall:  Set objectives and targets, and periodically monitor their progress through internal audit and management review  Communicate Quality, Environment and Health & Safety policy to the employees and to make it available to the public on demand.  Periodically review our Quality, Environment and Health & Safety policy and management systems for continuing suitability, adequacy and effectiveness. 13
  • 14. ` Environment: Sewage Treatment Plant (STP) : In-house STP treats domestic and industrial sewage of DLW township and workshop. The treated water is used for irrigation purpose in DLW township and nearby village farms. The digested sludge is sent to sludge drying beds, which is later used as manure. Methane gas mainly produced from the digester is collected in the gas holder and supplied to the canteen. Industrial Effluent Treatment Plant (IETP): IETP does the job of treatment of industrial effluent which mainly contains oil and grease. The treated water is sent to nearby villages for farming and kitchen gardening at DLW. Chromium Treatment Plant (CTP): CTP treats industrial effluent from Chrome Plating Shop. This has varying concentration of hexavalent chromium. This hexavalent chromium is converted into trivalent chromium in acidic condition and is precipitated for safe disposal. Safety: Safety of working personnel and of equipment is given prime importance in DLW. In compliance to statutory requirements all safety aspects are subjected to intensive periodic inspections. Four full time safety officers are engaged in the entire safety management of DLW including the function of overseeing compliance to all safety regulations by Workshop personnel. 14
  • 15. ` Safety Features in DLW Include : • Fire fighting arrangements with suitably trained personnel and regular checks of fire hydrants and static tanks etc. • System of checking/periodic inspection of wire ropes and lifting tackles • System of inspecting pressure vessels/air reservoirs • Provision of safety Guards on machines and over travel protection of material handling equipments • Protection of equipments from short-circuiting • Safety awareness training programme for supervisors and workers • Periodic maintenance of machinery and plant • Mock drills of emergencies for checking of emergency preparedness Residential Facilities A total of 3641 staff quarters are provided in a well-maintained township that provides maintained and green, providing excellent and pollution free environment. 15
  • 16. ` Educational Facilities There are 04 schools for Primary and Secondary Education, run by DLW administration where more than 2600 students are being taught. 01 Post Graduate Girl's College also exists in DLW premises. Besides 02 Central Schools, 01 Sr. Secondary School (Private) and 01 Bal-Niketan (run by DLW Women's Welfare Orgainisation) are also running in DLW campus. Medical Facilities 105 bedded well-equipped Railway Hospital, a Health Unit and a First-Aid post in workshop are functioning, taking comprehensive health care of around 20,000 employees and their family members. A Homeopathic and an Ayurvedic dispensary have also been provided. Institute/Community Centre etc. For various social needs of the staff Community Hall, Institutes, Barat Ghars, Kalyan Kendra, Rangshala and Officer's Club are functioning in DLW township. Cinema Club For recreation of the staff a Cinema Hall of around 700 capacity is functioning in DLW Township since 1967. Games and Sports Facilities for various games like Cricket, Hockey, Basketball, Badminton, Volley-ball, Football, Table tennis, Gymnastics, Athletics, Swimming, Golf, and Rifle Shooting have been provided for the staff. 16
  • 17. ` World class Swimming-Pool and well-developed Golf course are unique features. Inter Railway Tournaments are being regularly arranged in DLW premises. RAILWAY ZONES Following are the different Zone of Indian Railways and their Headquarters: NAME OF THE ZONE HEADQUARTERS 1. CENTRAL MUMBAI 2. EASTERN CALCUTTA 3. NORTHERN NEW DELHI 4. NORTH-EASTERN GORAKHPUR 5. NORTH-EAST FRONTIER MALIGAON 6. SOUTHREN CHENNAI 7. SOUTH-EASTERN CALCUTTA 8. WESTERN MUMBAI 9. SOUTHERN CENTRAL SECUNDERABAD Recently, six additional zones have been created by regrouping the existing nine zones: 10. NORTH CENTRAL ALLAHABAD 11. SOUTH WESTERN BANGALORE 12. EAST CENTRAL HAJIPUR 13. EAST COAST BHUBANESHWAR 14. WEST CENTRAL JABALPUR 15. NORTH WESTERN JAIPUR 16.SOUTH WEST CENTRAL RAILWAY BILASPUR Organizational Set Up: DLW has a design and development office responsible for all engineering functions related to diesel locomotives. Equipped with extensive designing tools, this office provides service support to Zonal Railways / Diesel Locomotive Maintenance Sheds and Locomotive Overhauling Workshops. This office is also responsible for product development, vendor development and vendor approval. It also performs technical advisory functions and coordination with RDSO/Railway Board on technical matters. Chief Design Engineer heads this office and is assisted by a team of technical experts. Functional Responsibilities: The functional responsibilities of Design and Development Office are: Design development of new locomotives, Import substitution /indigenous development of loco component, multi-sourcing, day-to-day design matters raised by diesel sheds and workshops, liaison with Research Design and Standards Organisation of Indian Railways, liaison with supply chain partners in respect of technical matters. Technical matters connected with Loco Standards Committee, Diesel Maintenance Group etc., 17
  • 18. ` providing technical clarifications in respect of design/specifications & important tenders. Failure investigations into major assemblies/critical components. All design issues for Electrics and Bogie of EMD locomotives. Moreover, design upgradation of EMD locomotives like power upgradation to 4500 BCV, incorporation of IGBT based technology, Distributed power; Hotel Load, Development of twin cab WDG4 and development of 12 cylinder 3000 HP EMD locomotives with AC-DC traction are being dealt with by Design Office. Liaison with CQAM and RITES in respect of inspection and quality control standards. Details of Locomotive Exported (up to March'2011) DLW has exported 105 locomotives to 11 countries. Details are as under: S.No. Country Types of locomotives Qty. 1 Vietnam YDM4, MG 25 Bangladesh YDM4, MG 10 2 WDM2,BG 13 3 Tanzania YDM4, MG 15 SriLanka WDM2, BG 8 4 12 Cyl., BG 5 5 PCCL, SriLanka WDM6, BG 1 6 Myanmar YDM4 1350 HP 11 VDM4, 1350 HP, CG 3 7 Sudan 2300 HP, CG 5 8 Mali 2300 HP, MG 3 VDM4, 1350 HP,CG 1 9 Angola 2300 HP, CG 2 10 Senegal YDM4, MG 1 11 Malaysia 2300 HP, MG 1 11 Mozambique 3100 HP, Cape Gauge 1 Total= 105 18
  • 19. ` Details of Locomotive supplied to Non Railway Customers (up to March'2011) DLW has supplied 395 locomotives to Indian NRCs in 2010-2011. Major Non-Railway Customers and locomotives supplied to them are as under: S.No. Customer's Name Types of locomotives Qty. Total WDS6 180 1 SAIL 181 WDG3A 1 2 VSP WDS6 33 33 WDS6 15 3 NTPC WDM2 42 88 WDG3A 31 WDS6 29 4 Port Trusts 36 WDG3A 7 WDM2 11 5 State Electricity Boards 21 WDS6 10 WDS6 30 6 Others WDG3A 5 36 YDM4 1 Total= 395 19
  • 20. ` OBJECTIVE OF PROJECT • To identify who is customer. • To understand what is the procedure of export. • To understand and analyze the documents needed for better export and documentation. • To analyze what is the annual turnover. - The total revenues earned by a company from its normal operations whether good or services. • To Find out How far dlw is from their competitors in terms of quality. 20
  • 21. ` CHAPTER NO.3 PROFILE OF THE COMPANY 21
  • 22. ` ABOUT COMPANY “DIESEL LOCOMOTIVE WORK” Varanasi, one of the oldest populated cities in the world and has a promising place in the international ground both as a hub of traditions and technology. One side the humming of divine and holy bells of the temples brings the city to life; on other side Diesel Locomotive Works (DLW) Varanasi is one of the largest industrial units in eastern part of the nation. DLW catch the attention of lot of foreign tourist students to observe on going amazing locomotive manufacturing process in Varanasi. Diesel Locomotive works Varanasi is located at the North end of the city and about 8 Km away from the Holy River Ganges Ghats. DLW is an ISO 9002, ISO 14001 & OHS 18001 Certified Organization of diesel electric locomotive. Diesel Locomotive Works, Varanasi (DLW) is one of the main manufacturing units run by the Indian Railways. This manufacturing unit came into existence in year 1961, as a “Green Field Project” in industrial association with ALCO, USA. This unit generates all the Diesel Electric Locomotives. In year 1964, the first locomotive was manufactured and it was devoted to the country. Diesel Locomotive Works, Varanasi produces only Electric Diesel locomotives and auxiliary parts of locomotives. Though it is an Indian corporation but it has supplied locomotives to some foreign countries also, includes Angola, Bangladesh, Malaysia, Myanmar, Sri Lanka, Vietnam, Tanzania, Sudan, Mozambique etc. Diesel Locomotive manufacturing Works, Varanasi works in three main sections viz:- 1) Engine section 2) Vehicle section and 3) Block section 1) Engine section manufactures more than 2000 machinery, which comprises of ALCO turbo superchargers, cylinder heads, connecting rods, camshafts, lubricating oil pumps, chrome plated cylinder liners and many different types of gears. 22
  • 23. ` 2) Vehicle section of DLW unit works on different fields that include Bogie Manufacturing, Component Fabrication, Locomotive Assembly, under frame Fabrication, and many more. Currently, Diesel Locomotive Works, Varanasi manufactures locomotives , DG sets. In locomotives section, again it manufactures two different types of products, one is EMD and an other is ALCO. VISION & MISSION Vision & Mission Our Vision -”To be a world class manufacturer of Diesel - electric locomotives." Our Mission - "We shall achieve our vision through Continuous Improvement in the areas of Product Quality, Research and Development, Supplier Partnership, Human Resource Development and Team Work with emphasis on Core Competence leading to Customer Satisfaction and Business Excellence." 23
  • 24. ` GENERAL INFORMATION • Workshop Land 219.997 acre • Township Area 520.6 acre • Covered Area in Shop 26.37 acre • Covered area of other service building 19.13 acre • Total No. of Staff Quarters 3641 • Total No. of staff on roll (as on March'2012) 5926 • No. of beds in Hospital 105 • Water consumption 223.82 Lakh Litres/day Electrical Power Requirement • Electrical Energy Consumption 262.07 Lakh Unit / Year • Workshop 4200 KVA • Colony 2600 KW • Administrative Building 1500 KW • Stand by Power Generation Capacity 5625 KW MANAGEMENT TEAM  General Manager- Shri B.P. Khare  CEE- Shri R.J. Mehrotra  FA&CAO- Shri Atul Mohan  COS- Shri S.P Piplani  CME- Shri Rakesh Vatash 24
  • 25. `  CPO- Shir L.B.RAI  CMS- Dr.Padam Singh  CE- Shri R.B Yadav  Secy. to GM/Dy GM- Shivendra Mohan PRODUCTS AND MARKET EDM WDG4 - 4000 HP GOODS LOCOMOTIVE Broad Gauge freight traffic Co-Co diesel electric locomotive with 16 Cylinder 4000 HP engine, AC- AC transmission, microprocessor controlled propulsion and braking with high traction high speed cast steel trucks. First turned out in 1999 with transfer of technology from General Motor (USA), this locomotive has exceptional fuel efficiency and very low maintenance requirements. It is specifically designed for heavy haul freight traffic requirements of Indian Railways for the 21st Century. The heart of loco Traction Control Converter uses the GTO devices (obsolete technology). Now the IGBT devices, has been introduced from Oct 2006. It is the latest technology and will be cost effective and gives higher reliability. The locomotive power has been upgraded to 4500 BCV and the first Loco (Loco No 12114) was manufacturedin May 07 25
  • 26. ` General Characteristic • Installed Power • 4000 HP • Axle Load • 21 T • Gauge • 1676 mm • Wheel arrangement • Co-Co • Wheel diameter • 1092 mm • Height • 4201 mm • Width • 3127 mm • Overall Length (Over Buffer Beam) • 19964 mm • Weight • 126 T • Max tractive effort • 54 T • Maximum speed • 100 Kmph • Fuel tank capacity • 6000 lts • Locomotive Control • EM 2000 with SIBAS-16 Traction Control WDG4-4000 HP GOODS LOCOMOTIVE TRACTIVE EFFORT & POWER CHART 26
  • 27. ` ALCO 2300 HP CAPE GAUGE LOCOMOTIVE TECHNICAL INFORMATION 2300 HP Main Line Locomotive, having fabricated cape gauge Co-Co bogies. These are provided with two drivers cabs, one at each end. These locomotives have been supplied to Angola and Sudan. Wheel Arrangement Co-Co sTrack Gauge 1067 mm Cape Gauge Weight 102 t Overall Length 17620 mm Wheel Diameter 921 mm Gear Ratio 18 : 93 Maximum Speed 100 Kmph Diesel Engine Type: ALCO 251-B 12 Cyl. V- Engine HP 2300 Transmission Electrical AC/DC Brake IRAB-1 Loco Air, Dynamic, parking Train Air Fuel Tank Capacity 3000 Liters 27
  • 28. ` 2300 HP METER GAUGE LOCOMOTIVE TECHNICAL INFORMATION 2300 HP Main Line Locomotive, having fabricated meter gauge Co-Co bogies. These are provided with two drivers cabs, one at each end. These locos have been supplied to Malaysia, Senegal and Mali. Wheel Arrangement Co-Co Track Gauge 1000 mm Meter Gauge Weight 102 t Overall Length 17620 mm Wheel Diameter 921 mm Gear Ratio 18 : 93 Maximum Speed 100 Kmph Diesel Engine Type: ALCO 251-B 12 Cyl. V- Engine HP 2300 Transmission Electrical AC/DC Brake IRAB-1 Loco Air, Dynamic, parking Train Air Fuel Tank Capacity 3000 Liters 28
  • 29. ` BROAD GAUGE MAIN LINE FREIGHT LOCOMOTIVE WDG 3A TECHNICAL INFORMATION Diesel Electric main line, heavy duty goods service locomotive, with 16 cylinder ALCO engine and AC/DC traction with micro processor controls. Wheel Arrangement Co-Co Track Gauge 1676 mm Weight 123 t Length over Buffers 19132 mm Wheel Diameter 1092 mm Gear Ratio 18 : 74 Min radius of Curvature 117 m Maximum Speed 105 Kmph Diesel Engine Type : 251 B,16 Cyl.- V HP 3100 Brake IRAB-1 Loco Air, Dynamic 29
  • 30. ` Train Air Fuel Tank Capacity 6000 liters MARKETING Marketing Division of DLW provides a single window service to our non-Railway customers. It deals with: ■ Sale of locomotives and spares to Non Railway Customers ■ Supply / Sale of DG sets and spares to Railways and Non Railway Customers ■ Single window services to customers ■ Export of locomotive through intermediaries like RITES and IRCON ■ Availing of credit under MODVAT ( MODIFIED VALUE ADDED TAX) scheme. • MODVAT refers to an excise duty scheme introduced in 1986 for allowing relief to final manufacturers on the excise duty borne by their suppliers for goods manufactured by them. It has now been replaced by the CENVAT scheme. It applies to certain specific items and is meant to limit the cascading effect of duty incidence on a number of goods where the MODVAT credit can be claimed on the purchase of raw materials on which excise has been paid. This MODVAT credit can be used to set off the excise duty payable on subsequent manufacture of goods. • Settlement of warranty claims and addressing complaints ■ Analysis of failure reports of NRC and Export locomotives and initiation of corrective and preventive actions ■ Payment of excise duty and CST /VAT on sale of excisable goods and settlement of disputed cases 30
  • 31. ` Details of Locomotives Exported during last 5 years No of SN Period Export Horsepower Gauge Country Locos 1 2002-2003 10 2600 HP BG Vietnam 2 2003-2004 3 2600 HP BG Bangladesh Cape 3 2005-2006 3 1350 HP Sudan Gauge 4 2005-2006 11 1350 HP MG Myanmar 1 1350 HP Angola Cape 5 2006-2007 2 2300 HP Angola Gauge 5 2300 HP Sudan 3 2300 HP Mali 6 2007-2008 MG 1 2300 HP Senegal Cape 7 2008-2009 1 3000 HP Mozambique Gauge 31
  • 32. ` YDM-4 8 2009-2010 3 Dan Cross Mozambique 6374 YDM-4 Cape 9 2010-2011 4 Mozambique Gauge 6706   CHAPTER NO. 4 LITERATURE REVIEW Company Background Diesel Locomotive Works (DLW) is production unit under the ministry of railways. This was setup in collaboration with American locomotive company (ALCO) USA in 1961 and the first locomotive was rolled 32
  • 33. ` out in 1964. This unit produces diesel electronic locomotives and DG sets for Indian railways and other customers in India and Abroad. Subsequently a contract for transfer of technology of 4000 HP Microprocessor Controlled AC/AC Freight (GT 46 MAC) / passenger (GT 46 PAC) locomotives and family of 710 engines has been signed with electro motive division of general motors’ of USA for manufacture in DLW. The production of these locomotives has now started and thus DLW is the only manufacturers of Diesel Electric Locomotives with both ALCO and General motors’ technologies in the world. BRIEF HISTORY OF DLW Welcome to Diesel Locomotive Works, Varanasi An ISO 9001, ISO 14001 & OHS 18001 Certified Organization. August 1961 DLW set up as a green field project in technical collaboration with ALCO, USA for manufacture of Diesel Electric Locomotives January 1964 First Broad Gauge Locomotive (WDM-2) released by (Late) Shri Lal Bahadur Shastri. First Locomotive rolled out and dedicated to the Nation November 1968 First Meter Gauge Locomotive (WDM-4) released by (Late) Shri Morarji Desai. February 1975 First Broad Gauge shunting Locomotive (WDS-6) turned out. January 1976 First Locomotive rolled out and dedicated to the Nation. Locos Exported to Tanzania December 1977 First Diesel Generating Set commissioned May 1984 Locos Exported to Vietnam August 1994 First 3100 HP WDM-2C Loco turned out. April 1995 First 2300 HP WDP-1 Passenger Loco turned out. July 1995 First 3100 HP WDG-2 Freight Loco turned out. December 1995 Locos Exported to Sri Lanka. April 1996 Locos Exported to Bangladesh. February 1997 Awarded ISO-9002 Certification. October 1997 Locos Exported to M/s Puttalam Cement Company, Sri Lanka. August 1998 First 3100 HP WDP-2C Passenger Loco turned out. March 1999 Highest out turn of 161 locos (amounting to 230 units) March 1999 4000th Locomotive turned out. August 1999 First PKW WDG-4 Locomotive turned out. March 2001 Awarded ISO-14001 Certification. March 2002 First DLW Built 4000 HP WDG-4 Freight Loco turned out. April 2002 First DLW Built 4000 HP WDG-4 Loco turned out. 33
  • 34. ` June 2002 First DLW Built 3300 HP WDG-3C Freight Loco turned out. December 2002 DLW certified for ISO: 9001: 14001. June 2005 2.4MW Diesel Generating set commissioned. September 2005 Certified by OHSAS- 18001: 1999. November 2006 First IGBT based WDG-4 Loco turned out. January 2007 5000th Locomotive turned out. November 2008 Locos Exported to Mozambique. March 2009 Highest out turn of 257 locomotive. November 2009 5690 locomotives up to 30th Nov'2009(including 348 EMD locos) April 2010 Surpassing target of making 250 engines and Produced 258 locomotives. November 2011 DLW produced 267 locomotives in 2011. March 2012 DLW has been next given a target of 275 locomotives including 215 EMD rail engines. - The Diesel Locomotive Works (DLW) is all set to produce powerful 5500 HP locomotive and it is expected that the first prototype WDG5 loco come by February 2012. - It will be the most powerful diesel locomotive ever produced by the Indian Railway. 34
  • 35. ` MARKETING DEPARTMENT IN DLW Marketing Division was set up at DLW in August 1987 for sales and after sales service of locomotives to Non- Railway Customers. With the setting of this organization it has been possible to provide single window service to Non-Railway Customer for all activity connected with sale of locomotives, DG Sets and Spares. 35
  • 36. ` The marketing Division maintains close liaison with different Non-Railway Customers. The formation of Marketing Division has greatly helped Non-Railway Customer in improving availability of spares & maintenance of locomotives. Marketing Division is also responsible for submitting offers & following up cases of sales of locomotive & spares to NRCs and Export of locomotive & spares through agencies like RITES and IRCON. It is also the nodal department at DLW for DG sets. DLW is registered with Engineering Export Promotion Council & can thus participate in Deemed Export orders directly and claim export benefits. For export order the demand is met through RITES/IRCON depending on the country of export. Supply of Locomotive & Spares to Non-Railway Customer & Export During the year 2010-11 DLW has so far received purchase orders of 39 locomotives worth Rs 328.5 crore from non-railway clients and foreign countries. An export order of 40 locomotives is expected from Bangladesh. DLW has so far supplied 395 locomotives to different Non-Railway Customers in India and 105 Locomotives exported to Countries like TANZANIYA, SRI LANKA, BANGLADESH, VIETNAM, MALAYSIA, MYANMAR, ANGOLA, SENEGAL, MALI, SUDAN, & MOZAMBIQUE. In current financial year (2011-12), the DLW has been given a target of 275 locomotives including 215 EMD rail engines. SPARES During the year 2010-11 spares parts worth Rs. 10.61 crore were supplied to Non-Railway Custo mer in India as well as Export. 36
  • 38. ` EXPORT PROCEDURE IN DLW ABOUT RITES RITES Ltd., a Government of India Enterprise was established in 1974, under the aegis of Indian Railways. RITES are incorporated in India as a Public Limited Company under the Companies Act, 1956 and are governed by a Board of Directors which includes persons of eminence from various sectors of engineering and management. RITES Ltd., an ISO 9001-2000 company, is a multi-disciplinary consultancy organization in the fields of transport, infrastructure and related technologies. It provides a comprehensive array of services under a single roof and believes n transfer of technology to client organizations. In overseas projects, RITES actively pursues and develops cooperative links with local consultants / firms, as means of maximum utilization of local resources and as an effective instrument of sharing its expertise. RITES are internationally recognized as a leading consultant with operational experience of 62 countries in Africa, South East Asia, Middle East and Latin America. Most of RITES foreign assignments are for National Governments and other apex organizations. SERVICES BY RITES • Facilities Planning for Rolling Stock Maintenance • Technical Assistance for Workshop Modernization • Supply & Commissioning of Workshop Machinery and Plant • Supply, Commissioning and Maintenance of Locomotives & Rolling Stock 38
  • 39. ` • Leasing of Locomotives and Passenger Coaches • Supply of Spares • Supply of Signaling Equipment • Rehabilitation of Locomotives and Wagons • Rehabilitation of Traction Machines & Railway Bridges RITES ROLE IN DLW In DLW, RITES is the representative of Export Division in Marketing Department. Through RITES all the loco are Exported. DLW is only the manufacture of loco, but the procedure of sending loco from DLW to another country is done by RITES Ltd. The conclusion is that all the Procedure of Export is done by RITES Ltd. On the behalf of DLW. DLW provides free service to NRC and export locomotives up to warranty period and thereafter supplies spare parts and technical support on payment basis. For Indian customers DLW directly deals with through marketing wing. And For export locomotives, DLW deals through RITES ltd. CONTRACT BETWEEN RITES & DLW As we know that DLW has done export through RITES ltd. For maintaining this relationship, time to time as per requirement a contract made, name as BACK TO BACK CONTRACT between both the organizations. 39
  • 40. ` This contract updates the relationship between RITES & DLW legally. It’s also include the related information about loco and export procedure for further process DETAILED OF EXPORTED LOCO IN DLW DLW built Locomotives have been successfully exported to all this country as mention above with their no. & HP.: NO. OF SN PERIOD HORSEPOWER COUNTRY EXPORT 1 2002-03 10 1350 HP Vietnam 2 2003-04 3 2600 HP Bangladesh 3 2004-05 3 1350 HP Sudan 4 2005-06 11 1350 HP Myanmar 1 1350 HP Angola 5 2006-07 2 2300 HP Angola 5 2300 HP Sudan 3 2300 HP Mali 6 2007-08 1 2300 HP Senegal 7 2008-09 1 3000 HP Mozambique 8 2009-10 3 3000HP Mozambique 9 2010-11 4 3500HP Mozambique 40
  • 41. ` • At INTERNATIONAL LEVEL the main competitors of DLW (Asia Largest manufacturing of Locomotive) are CHINA, JAPAN, GENERAL PROCODURE OF EXPORT NOTE: In DLW, all the activity of EXPORT is done by the RITES LTD. GENERAL PROCEDURE OF EXPORT TRADE Usually in any Export House following steps are followed to export The goods. These steps are:- • Receipt of Enquiry and sending Quotation. • Receipt of order or indent • Assessing Importer’s credit worthiness and securing a guarantee • Obtaining Export License • Obtaining Pre-finance License • Production or Procurement of goods • Pre Shipment Inspection • Excise Clearance • Obtaining Certificate of Origin • Reservation of shipping space • Preparation of Invoice • Packing and Forwarding • Insurance of Goods • Custom Clearance • Obtaining Mate’s receipt • Payment of Freight & Insurance of Bill of Lading 41
  • 42. ` • Securing Payment EXPORT PROCEDURE IN SEVERAL STEPS STAGE 1: Customer Search and Receiving of Order This work is assigned to the marketing persons of the company (RITES) they Establish the relationship with customer. Usually the company gets The order in three ways:-  Through Personal Visit:  Through International Trade Fair & Exhibition  Through Internet  Through Global Tender STAGE 2: ORDER IMPLEMENTED Once the order has been received, the export order is scrutinized with reference to the terms and condition of the export contract. This is the most crucial stage of any export process. All subsequent action and reaction will depend on the terms and condition of the export contract. It is ensured that contract has been entered into in accordance with the prevalent export policies of the country and foreign exchange regulations like FERA, FEMA. The export order must specify the mode of payments such as: • Letter of Credit [L/C] • Documents on Payment [D/P] • Documents against Acceptance [D/A] In this stage, the Company prepares all the necessary documents including Sales Contract required by the buyer and submits to the negotiating bank in exact specified format and manner. The most important documents demanded by the importer are:- • Bill of exchange • Commercial Invoice • Packing List • Marine Insurance Policy • Certificate of Origin Then Buyer Company sends the Sales Contract which is the declaration by them that all the terms and conditions of order are accepted to them. 42
  • 43. ` STAGE 3: PERFORMANCE OF MARKETING DEPT. As soon as the order has been confirmed the Buyer Company sends the Sales Contract putting their own seal which is the declaration by them that all the terms and conditions of order are accepted to them. After the contract, the marketing dept. places the Manufacturing Order on the Production Manager & advice the Material Procurement. Department for insuring the availibity of purchase item required for the purchase of Goods. This note contains the description of the goods as has been given in export order along with the instructions given by importer.The date by which the goods must be ready is clearly indicated in Manufacturing Order. On the basis of work order Manufacture start. After receiving MO Production of the goods are started. STAGE 4: PACKING & SENDING OPTION Then as per the instructions given by importer goods are packed in Packing Department. Now these packed goods are sent to shipping agent through transporters or through Courier. STAGE 5: FINAL INSPECTION After the stage of inspection, it is carried out by the Quality assurance dept. of DLW & the final inspection is done by DLW, RITES & IMPORTER (If importer so desire) WORKING OF COMMERCIAL DEPARTMENT i.e. EXPORT DOCUMENTATION Documentation Department is usually called as ‘Commercial Section’ AT DLW the export is done by the Marketing Dept. up to the stage of Manufacturing & Turning out from DLW then after the other export formalities are carried out by the RITES. Commercial Section can be shown by following figure:- • COMMERCIAL SECTION • COMMERCIAL MANAGER • DEPUTY MANAGER • ASSISTANT MANAGER • CLERICAL STAFF & WORKERS The main function of the commercial section is to prepare and maintain the documents of each and every activity involved in the Export procedure. Documentation is mainly done to give justification before Reserve Bank of India of foreign exchange transaction which is carried out in Export Process. Thus, the Export Documents represents the total Export Procedures. 43
  • 44. ` Mainly the Export Documents Can be divided into two types:- (A) COMMERCIAL DOCUMENTS:- These documents are used by ‘Custom of Trade’ in International Commerce by exporters and importers in discharge of their respective legal and other incidental formalities under Sales contract. Commercial Documents can be further divided into two types of documents which are as follows:- 1) PRINCIPAL DOCUMENTS. 2) AUXILLARY DOCUMENTS. 1. PRINCIPAL DOCUMENTS:- These documents are required for effective physical transfer of goods and title thereto from exporter to importer. Following documents come under this category:- • Realization of Export Sale Proceeds • Commercial Invoice and Invoice prescribed by Importing Country • Packing List • Certificate of Inspection • Certificate of Insurance/Insurance Policy • Bill of Lading or Combined Transport Documents 44
  • 45. ` • Certificate of Origin • Bill of exchange • Shipping Advice 2. AUXILIARY DOCUMENTS:- These documents are required in connection with preparation or procurement of Principal Export documents. Following documents are Auxiliary documents:- • Proforma Invoice • Shipping Instruction • Insurance Declaration • Intimation for Inspection • Shipping Order • Mate’s Receipt • Application for Certificate of Origin • Letter to Bank for negotiation or collection of documents (B) REGULATORY DOCUMENTS:- These documents are prescribed by different Government Department/Bodies for compliance of formalities under relevant laws, rules and regulations governing export trade viz. FERA ,Import & Export (control) Act, Central Excise Rules, Export (Quality Control &Inspection) Act, Customs Act and Major Port Trusts Act etc. Following documents are of Regulatory nature: • Exchange Control Declaration-GR Forms • Freight Payment Certificate • Insurance Premium Payment Certificate • Gate Pass-I/II • ARE-1/ CT-1 Forms • Shipping Bill/Bill of Export • Port Trust Copy of Shipping Bill/ Export Application/ Dock Challan • Receipt for Payment of Port Charges • Vehicle Ticket Broadly we can classify the total working of Commercial Section in the three stages. They are:- 1) Pre Shipment Documentation 2) Shipment Documentation 3) Post Shipment Documentation 45
  • 46. ` 1. PRE-SHIPMENT DOCUMENTATION: Pre shipment procedure starts from the very beginning i.e. receiving the order and it ends with handling over the goods to the transporters. In the case of Advance payment following documents come under Pre shipment documents:- After receiving the export order, Sales Contract is sent to buyer his is resent by buyer after putting their seal along with the 30% of total Invoice value (in the case of advance payment) then after packing of goods, Packing Slip is sent from the Packing Department, with that Slip ,Packing list is prepared in Commercial section. After checking Packing List thoroughly, Invoice is prepared and then both Packing List as well as Invoice is sent to buyer to get the remaining 70% of the payment. When they make total payment goods are sent to them. In this procedure, first of all goods are handled over to the transporter. Then transporter gives whole goods to Clearing Agent. 2. SHIPMENT DOCUMENTATION: After taking over the whole goods by Clearing Agent, Shipment Procedure is started. If Consignment is going to be exported by Sea, goods are sent from the company to Mumbai. If goods are to be shipped by Air then goods are transported to Delhi Airport. Shipping Instruction (3 Copies) is sent to Clearing Agent which contains the information about consignment. For e.g. Dimension of Cartons i.e. No. and Size of Cases, Detail of items, Name of Transporter etc. When goods are loaded on to the Ship/Aero plane Challan is provided by the owner of Ship/Plane. Challan, Bill of Clearing agent (in the case of FoB), Invoice and ARE (Application for Removable of Excisable goods) are sent to Buyer. Terms of Delivery means in delivering the goods to the Buyer which cost will be included whether it will include only cost of production or it will also include transportation costs. Mainly there are three terms of Delivery: • FOB (Free on Board):- It is also called as Freight on to-pay Basis that means freight charges will be paid by Buyer. • C.I.F. (Cost including Insurance & Freight):- It is also called as Freight on Pre-Paid Basis that means Freight charges will be paid by Exporter and Goods will be insured. • C&F (Cost including Freight):- It means only Freight charges will be paid by exporter and Insurances charges will be covered by buyer itself. 46
  • 47. ` 3). POST SHIPMENT DOCUMENTATION:- Post shipment Documentation start when goods are reached at their destination then to clear the goods from the customs in the Importer Country some documents are needed. Which are as follows:- Shipping Advice: - It is sent as covering letter. it contains details of Consignment and clearing agent . a). Invoice (2 copies) b). Packing List (3 copies) c). Bill of Lading (1 original & 1 Xerox) d). Airway Bill (1 Xerox & 1 original copy) e). Shipping Bill (Original):- Shipping Bill is provided by Customs of India to the Clearing Agent of the Company after checking of goods. Without Clearance of Customs no export can take place. It has all the details of Export Order like details of items, Invoice value of total consignment, Foreign Currency involved, Exchange Rate, Draw back details, Date of Export etc. This shipping Bill is needed at the customs of Importer’s Country as well as Bank of Exporters to get the Payment. It is divided in the two sections: 1. Exchange Control Copy: - First two Pages of Shipping Bill in which Exchange Rates and Freight charges, Insurance Charges (if applicable) are indicated, are called exchange control copy. 2. Export Promotion Copy: - Govt. give export incentive on certain items so, in Shipping Bill all details are given regard in Drawback like their rates and amounts. DOCUMENTS SENT TO BANK:- a). Invoice (2 Copies) b). Packing List (original) c). Exchange Control Copy of Shipping Bill (original) d). Bill of Lading (2 Copies) 47
  • 48. ` c). Copy of Original FIRC (Foreign Inward Remittance Certificate) When all the documents are sent to bank, whole transaction is justified and then Bank sends Reference No. with that Ref. No. Bank Realizations Certificate is made in the Company which is again sent to Bank after 6-8 months Bank sends that Certificate to the Company by putting their own seal. This is the last document in any Export Order. DOCUMENT USED IN PRE-SHIPMENT • SALES CONTRACT • PROFORMA INVOICE • COMMERCIAL INVOICE • MARINE INSURANCE POLICY SALES CONTRACT It is a legal contract of exchange of goods, services or property to be exchanged from seller to buyer (in case of export: from exporter to importer) for a pre-decided value in money or money equivalent paid or promised to pay same. It is a specific type of legal contract in which all details regarding trade which is going to take place between any two countries. It contains:- • Contract No. • Invoice of • Delivery Period • Date • Port of Loading • Port of Destination • Mode of Payment • Exchange Rate • Invoice • Packing Description • Freight Charges • Insurance Charges • Name of Seller’s Bank • Description of Goods 48
  • 49. ` PROFORMA INVOICE A proforma invoice is a very common international document; despite its name, it is not an invoice at all but a quote. An international transaction includes so many variables that it is sometimes difficult for importer to have a good grasp of final cost of goods. For e.g. the cost of goods is increased by the cost of shipping, insurance and so forth. In order to determine these costs the import may request for a proforma invoice which helps in determining the accurate and precise preview of actual invoice which is usually prepared when a transaction is going to take place. In those cases when exporter requests payment on a ‘letter of credit basis, the information contained in proforma invoice is used by issuing bank to open the letter of credit. It contains:- • Name & Address of the Seller • Name & Address of the buyer • Date • Delivery Time • Terms & Conditions • Port of Loading • Port of Discharge • Terms of Trade • Freight to be covered by • Insurance to be covered by • Banker’s Name • Mode of Transport • Currency used • Description of Goods • Signature COMMERCIAL INVOICE Commercial invoice is the basic document in any trade. It is also called ‘document of contents’ because it generally contains all the information required for preparation of all other documents. 49
  • 50. ` A commercial invoice is the seller’s bill of merchandise. There is no standard format for commercial invoice but usually it contains the following: • Exporter’s Name & Address • Invoice No. • Date • Buyer order No. • Consignee Name • Buyer Name and Address • Country of origin of goods • Country of final destination • Terms of Delivery & Payment • Pre Carriage by • Vessel/Flight No. • Port of Loading • Port of Discharge • Final Destination of Goods • Marks & Nos. • Number of Packages • Description of Goods • Container No. • Quantity • Rate • Amount • Declaration • Signature of Authority 50
  • 51. ` MARINE INSURANCE POLICY It provides cover against perils of sea and other connected risks to which goods are exposed to. It is same as any other insurance and usually done to minimize the risk related to shipment of goods. It contains:- • Certificate No. • Open Cover No. • Open Cover Date • Assured Name • Address of the Assured • Receipt Date • Effective From • Issued at • Net Premium • Name of the Issuing Company • Total Sum insured • Sum Insured in Foreign Currency • Basis of Valuation • Country of Destination • Mode of Transport • Packaging Description • Commodity Description • Terms of Insurance DOCUMENT USED IN SHIPMENT 51
  • 52. ` • PACKING LIST • CERTIFICATE OF ORIGIN • CERTIFICATE OF INSPECTION • MATE’S RECEIPT • BILL OF LADING PACKING LIST It is a document which shows nature and the number of goods etc.put in each package/container with distinctive number of marks. This is generally needed by the importer when he is importing different types or sizes of merchandise so that he may identify the nature of goods in each package. It is also used by custom for checking the goods on random basis or otherwise. Thus, packing list is mainly used to facilitate easy identification of goods in each package/container by the importer or custom. It generally contains:- • Exporter’s Name & Address • Invoice No. • Date • Buyer order No. • Consignee Name • Buyer Name and Address • Country of origin of good • Country of final destination • Terms of Delivery & Payment • Pre Carriage by • Vessel/Flight No. • Port of Loading • Port of Discharge • Final Destination of Good • Marks & Nos. • Container No. • No. & Kind of Packages • Description of Goods • Quantity of Goods • Remarks, if any 52
  • 53. ` CERTIFICATE OF ORIGIN This is a document which is mostly required by Common wealth Countries. It is a certificate of declaration by the shipper regarding origin of goods. The certificate is generally attested or certified by the Chamber of Commerce for industry or other agency designated for this purpose. The main aim of this certificate is to enable the importer to get concessional tariffs. It contains:- • Exporter’s business Name, Address & country • Consignee’s Name, Address & country • Means of Transport & Route • Item No. • Marks & Nos. of Packages • No. & Kind of Packages, description of goods • Origin of country • Gross Weight & other quantity • No. & Date of Invoices • Certification & Signature by Chamber of Commerce • Declaration & Signature by Exporter CERTIFICATE OF INSPECTION For ensuring the quality government has made it compulsory for certain products that these should be inspected by some authorized agency. EXPORT INSPECTION COUNCIL OF INDIA (EICI) is one such agency which carries out such inspections and issues the certificate that the consignment has been inspected as required under the Export Quality Control and Inspection Act, 1963 and satisfies the conditions relating to quality control and inspections as applicable to it and is export worthy. Some countries have made it mandatory for the goods being imported to their countries It contains:- • Beneficiary Name & Address • Applicant • Description of the Goods • Bill of Lading quantity • For Transportation to 53
  • 54. ` • Remarks • Item wise/Size wise Break up of Quantity MATE’S RECEIPT It is issued by the chief of vessel after cargo is loaded and it is duly signed and stamped by Chief Officer or Master of vessel. The shipping company does not issue the bill of lading unless it receives the Mate’s receipt. It contains:- • Mate Receipt No. • Shipping Bill No. • Date • Voyage • Exporter’s Name • CHA Name • Marks • Quantity of Goods • Description of Goods • Cargo Weight • Consignee Name • Terminal or Chief Officer signature BILL OF LADING The Bill of Lading is a document issued by the shipping company or the agent acknowledging the receipt mentioned in the bill for shipment on board of vessel and undertaking to deliver the goods as per the order and condition as received by the consignee or according to his order. The Bill of Lading is issued in standardized aligned document format. It contains:- • Shipper’s Name • Consignee • Notifying Party 54
  • 55. ` • Pre Carriage by • Place of Receipt by Pre Carrier • Ocean Vessel • Port of Loading • Port of Discharge • Marks & Nos. • No. of Packages or Units • Kind of Packages, description of Goods • Weight of Goods POST SHIPMENT DOCUMENT • SHIPPING BILL • BILL OF EXCHANGE • CONSULAR INVOICE • BANK CERTIFICATE OF EXPORT & REALISATION SHIPPING BILL The shipping bill is the main document on the basis of which customs office grants the permission for export. After loading the goods on ship it is prepared by clearing agent but it is mainly needed to justify the goods going to be exported. It contains:- • CHA Name • Date • State of Origin • Exporter’s Details • Consignee • Port of Loading • Port of Discharge • Gross Weight • Total Packages • Net Weight • Country of Destination • Nature of Cargo • Marks & Nos. 55
  • 56. ` • Foreign Exchange Bank A/C No. • RBI Waiver No. • Invoice Details • Exchange Rate • Insurance Charges • Freight Charges • Discount • Commission • Packing Charges • Draw Back Description • Nature of Payment • Buyer Name & Address BILL OF EXCHANGE It is a written instrument whereby the person issuing it directs the other party to pay a specified amount to a certain person or to bearer of the instrument i.e. bill of exchange. In the context of an export-import transaction, bill of exchange is drawn by the exporter. According to which importer are to pay a certain amount to a certain person or to the bearer of bill of exchange. Export consignment is passed on to the importer only when the importer’s order contains bill of exchange. It contains:- • Amount of bill • Place • Name & Address of the Bank in which amount is to be paid • Order by exporter • Invoice No. • Name & Address of the import • Exporter’s Signature BANK CERTIFICATE OF EXPORT & REALISATION This certificate contains the information of export consignment and as to be submitted to the bank for each and every consignment. The information required for making bank certificate is obtained by various shipment documents named as Invoice, Shipping Bill, Bill of Lading, Airway bill, Insurance bill, Freight Memo etc Three copies of ‘bank certificate’ addressed to the “JOINT DIRECTOR OF FOREIGN TRADE” is prepared and submitted to bank. Copies of Export Invoice, custom attested EP (Export Promotion) copy of Shipping Bill and other relevant documents are also submitted along with the Bank Certificate 56
  • 57. ` The Bank Certificate is declaration by the exporter that they have forwarded the documentary export bill to its bank for the collection or negotiation or purchase as per particular given in Bank Certificate. The bank verifies the information given by the exporter and certifies the same. The bank passes the original copy with the relevant copy of attested documents to the exporter and duplicate copy to the Licensing Authority. Bank retains the triplicate copy for its record. It contains:- • Invoice No. • Export Promotion Copy of Shipping Bill duly-authenticated by custom • Description of Goods as given in Custom Authenticated-Shipping Bill • Bill of Lading No. • Destination of Goods • Bill Amount • Foreign Exchange used • Freight Amount as per Bill of Lading • Insurance amount as per Bill receipt • Date of Realization of export proceeds • SDF (Sales Declaration Form) Form No. & Signature of Exporter MODES OF PAYMENT There is a no. of different payment methods that can be used when importer deals with exporter. Mostly three of them are used. Which are as follows?  DOCUMENTS AGAINST PAYMENT  LETTER OF CREDIT DOCUMENTS AGAINST PAYMENT The exporter makes the shipment and sends the shipping documents to the exporter’s bank for collection. The bank then sends the shipping documents along with a collection letter to the importer’s bank, which then sends 57
  • 58. ` a collection notice to the importer. The importer makes payment upon receiving the notice, and only after payment the importer receive the original shipping documents with which they take the physical possession of the goods. The major advantage of the use of DP is the low cost as compared to use a Letter of Credit. But this is offset by the risk that the importers sometimes reject the documents for some reasons (or when they are not in order).Since the cargo has already been loaded (to generate the documents) exporters have little recourse against the importer in case of non-payment. So a document against payment (DP) arrangement involves a high level of trust between the exporters and importers. LETTER OF CREDIT A Letter of credit is very common and familiar document in setting payment between buyer and seller. It is a signed instrument embodying an undertaking by the bank of the buyer to pay the seller a certain sum of money on presentation of documents evidencing shipment of specified goods and subject to compliance with stipulated terms and conditions. The International Chamber of Commerce (ICC) has a published a set of universal recognized guidelines governing the issue of a Letter of Credit in Uniform Custom and Practice of Documentary Credit (UCPDC). Following parties are involved in issuing a letter of credit:- 1. APPLICANT: - The firm asking for a Letter of Credit is applicant. Usually the applicant is importer who is going to import goods but it is not in position to pay for the goods currently. 2. BENEFICIARY: - The firm named in a letter of credit as the firm to whom the bank is insuring payment if the importer does not pay. Usually, the beneficiary of a letter of credit is the exporter. 3. ISSUING BANK: - It is that bank which provides the letter of credit to the importer. It has the contractual obligation to pay the beneficiary (exporter) on the presentation of necessary documents by them when importer is unable to pay. 4. ADVISING BANK: - In a Letter of Credit transaction, the bank that determines whether the issuing bank is a legitimate bank and the terms of the Letter of Credit offered by the issuing bank on behalf of the importer are appropriate. Generally, the advising bank is the exporter’s regular bank. But in some cases the exporter’s bank will delegate this role to another bank which is more experienced. 58
  • 59. ` LETTER OF CREDIT (PAYMENT PROCEDURE) The Letter of Credit (L/C) payment procedure is usually as follows:- • The Importer applies to open the L/C to exporter through A bank that can open the L/C in their country. • The opening Bank will inform the exporter that L/C has been established. • Exporter checks all the terms and conditions listed in the L/C. If all the terms and conditions are acceptable the will arrange the shipment within the time specified in the Letter of Credit. • After the goods are loaded onto the ship without any damage, the captain of the ship will issue clean Bill of Lading to the exporter. With clean Bill of Lading only they can claim the ownership of goods. • Clean Bill of Lading and other relevant documents will be submitted to their bank to gather the irrevocable Letter of Credit. It is an often used payment method. This is a formal payment method that offers a lot of protection to the parties. In simple words, a Letter of Credit is a letter written by the importer’s bank to the exporter. It verifies that the payment will be guaranteed when bank is presented with concrete documents (Bill of Lading, Freight documents etc.). Mostly Letters Of Credit are irrevocable once the importer has sent them. • A Letter of Credit usually includes applicant (the importer), beneficiary (I/E agent), opening bank, negotiating bank, specification and quantity of the goods, amount of money, loading port and destination port, shipment date, the validity date of the L/C, terms and conditions agreed by both the importer and exporter and details of the documents required by the importers (Bill of Exchange, Commercial Invoice, Packing List, Insurance Certificate etc.) 59
  • 60. ` • The exporter’s bank will send the clean Bill of Lading and relevant documents to opening bank. • Opening bank will inform them that all documents are received. • Then importer will go to the bank to make the payment to get the clear Bill of Lading and relevant documents. • With all of these documents, they can clear the import customs and pick up the goods after the goods have arrived on the destination sea port. • L/C is used for the larger quantity order shipped by the sea. • The typical L/C scenario takes 14-21 days to complete. STEPS IN PROCESSING OF A LETTER OF CREDIT The main steps in the processing of a Letter of Credit are as follows:- ◊ Issuance of a Letter of Credit ◊ Shipment under a Letter of Credit ◊ Payment under a Letter of Credit 1. ISSUANCE OF A LETTER OF CREDIT:- We can understand the first and foremost step of processing of a Letter of Credit with the help of following diagram:- EXPORTER’S BANK IMPORTER’S BANK EXPORTER IMPORTER a. First of all the exporter and the importer agree on a sale under “Letter Of Credit” terms. The exporter sends a proforma invoice to importer. b. Then importer takes the proforma invoice to its bank and requests for a Letter of Credit. c. The importer’s bank issues a Letter of Credit and sends it to the exporter’s bank. 60
  • 61. ` d. The exporter’s bank receives and revises the Letter of Credit. Then it notifies the exporter that it is ready to ship the merchandise to the importer. 2. SHIPMENT UNDER A LETTER OF CREDIT:- EXPORTER’S BANK IMPORTER’S BANK EXPORTER IMPORTER a. The exporter sends the merchandise to the importer but gathers all the documents and sends them to the exporter’s bank. b. The exporter’s bank checks that whether the documents fulfill the requirement of Letter of Credit or not and then sends them to the importer’s bank. c. The importer’s bank also verifies the documents that they match with the requirement of Letter of Credit and notifies the importer that everything is in order. 3. PAYMENT UNDER A LETTER OF CREDIT: EXPORTER’S BANK IMPORETR’S BANK 61
  • 62. ` EXPORTER IMPORTER a. The importer pays the importer’s bank in order to collect the documents that will be needed to collect the merchandise and clear the customs. b. The importer’s bank sends the importer’s payment to exporter’s bank. c. The exporter’s bank notifies the exporter that they have been paid by importer. CHAPTER NO. 5 RESEARCH METHODOLOGY 62
  • 63. ` The project on Dlw Export procedure to Non-Railway Customer is based on Two Researches. 1). Exploratory research design & 2). Conclusive research design. The approach of research was survey and instrument used was questionnaire for quantifying whether the organization employees are very well aware and satisfied with the facilities provided by the DLW. Before going through the questionnaire first one should understand the meaning of the terms used in the project for better understanding of the project report. These are exploratory research and conclusive research, sampling plan and reliability of the questionnaire. WHAT IS EXPLORATORY RESEARCH? Investigation into a problem or situation which provides insights to the researcher. The research is meant to provide details where a small amount of information exists. It may use a variety of methods such as trial studies, interviews, group discussions, experiments, or other tactics for the purpose of gaining information. WHAT IS CONCLUSIVE RESEARCH? conclusive research is meant to provide information that is useful in reaching conclusions or decision-making. It tends to be quantitative in nature, that is to say in the form of numbers that can be quantified and summarized. It relies on both secondary data, particularly existing databases that are reanalyzed to shed light 63
  • 64. ` on a different problem than the original one for which they were constituted, and primary research , or data specifically gathered for the current study. WHAT IS SAMPLE? Sample is defined as subgroup of elements of the population selected for participation in the study. Sample characteristics, called Statistics, are then used to make inferences about the population parameters SAMPLING PLAN; There is no sampling plan as such as the study involved in understanding the various processes and analyzing them. The study involved in the detail analysis of secondary data gather from various sources and there for no sample size and plan has been considered. Type of the Data Sources of data: Data has been collected through literature survey and expert opinion. The part of data is collected from various primary sources and secondary sources. • Primary Data Sources – Information gathered through interview and discussing with departmental Members. • Secondary Data Sources – Past Data • Type of Research – Exploratory & Conclusive Analysis • Type of Sampling plan – No Sampling plan - There is no sampling plan as such as the study involved in understanding the various processes and analyzing them. The study involved in the detail analysis of secondary data gather from various sources and there for no sample size and plan has been considered. 64
  • 65. ` CHAPTER NO. 6 DATA  ANALYSIS 65
  • 66. ` LOCOMOTIVE PRODUCTION Varieties of management interventions, active co-operation of employees, and their high level of motivation enabled DLW to increase its output significantly in the current decade. This is depicted below: Locomotive Out Turn EMD ALCO 30 0 39 59 80 25 218 199 187 0 15 22 No. of 20 147 200 Locomotive 0 24 15 126 0 20 66
  • 67. ` 10 106 0 3 50 92 0 2003-04 2004-05 2005-06 2006-07 2007-08 2008-09 2009-10 2010-11 YEAR • In the last financial year (2010-11), DLW has produced 267 locomotives (including 150 HHP EMD locomotives) . 67
  • 68. ` TYPE WISE LOCOMOTIVE OUT-TURN 2007-08 2008-09 2009-10 2010-11 Type of Targets Actual Targets Actual Targets Actual Targets Actual Loco ALCO 138 148 148 157 168 175 148 167 GM 62 59 80 80 62 59 80 80 EXPORT 4 4 0 1 4 4 0 1 NRC 16 20 22 19 16 20 22 19 Total 220 222 250 257 250 258 250 267 • In current financial year (2011-12), the DLW has been given a target of 275 locomotives including 215 EMD rail engines. TURNOVER Year Rs. in crores 2003- 04 558 2004 – 05 855.88 2005 – 06 934.65 2006 – 07 872.05 2007 – 08 984.65 2008 – 09 1297.54 2009-10 1560.28 2010-11 2404.38 68
  • 69. ` CHAPTER NO. 7 FINDING AND CONCLUSION 69
  • 70. ` After completing my project I familiarize with DLW, and I get that diesel locomotive works is a famous technological temple, which came in existence, in 1964 by Late Shri Lal Bahadur Shastri. DLW export to the following countries like Sri Lanka, Bangladesh, Angola, Tanzania, Vietnam,Sengal Mozambique, Malaysia, Sudan, Myanmar etc. There are many facilities for the employees as hospital, health club, sports club, school and college, sewing center, technical training center etc. In short we can say that all the facility which the ordinary employee needed is provided by welfare department and the entire employee are very well aware with welfare programmes. They take advantage with programme in any form. Very few improvement but important improvement, which mentioned above, is needed in welfare programmes, which make the employees more satisfied. 70
  • 71. ` FINDINGS : The above study helps to identify the positive and negatives of DLW, Varanasi. This is the major key area the employees got benefited directly through direct & indirect way.. Although company is doing good at their business, as we can analysed from the above interpretation that • Locomotive turn out is constantly increasing. • Company is able to achieve its target • And if we compare the the actual turnover in year 2003-2004 i.e. 558 with 2010-2011 i.e. 2024.38 which is more than double. It shows that company is in its growth stage. But on the other hand, during this study I found few negative points which I personally will that company should rectify for the effective production system. • The major problem that I found was Ineffective utilization of resources Company’s input are more than requirement, employees were wasting spare parts of mass production , and no one was their to take care of it, which may cause loss to company in near future. • Excess wastage of raw material during transfer from one place to another. • Absence of proper supply of required equipments, due to which company facing high lead time and turn up time. • They don’t have product inception process, during transportation or warehousing. Which me cause question to their quality. • There was no proper schedule for employees, they were not sincere during work hours. • Employees were not cooperative and absence of proper coordination of work. So, the company takes this study to rectify the problems in few above given areas areas due to which production process get effected, So that company can play more better in upcoming future. 71
  • 72. ` CHAPTER NO. 8 RECOMMENDATIONS 72
  • 73. ` As I work n my project report. I feel that DLW is very prosperous and the facilities provided to their employees here are very much satisfactory. But some suggestions. Which in want to give are as follows? 1) The standard of hospital should he tried to improve. 2) Medical store facility should he provided in the campus of the hospital with large stock of medicine. 4) If lunch provided in DLW canteen it will also motives employees. 5) The crèche should also be provided by DLW welfare Department. 6) Welfare department should motivate the employees in such a manner that employee’s female member most participate in women welfare programme. 7) The number of member of sports club and health club is very low so it can increase by the efforts of welfare officers of DLW. 8) Always there should be good communication between welfare. 9) Department and employees. 10) All employees should be motivated to part in cultural programmes. 73
  • 74. ` CHAPTER NO. 9 LIMITATIONS 74
  • 75. `  There is the possibility of ambiguous replies from the respondents which can give untrue or misleading result.  Few people did not have the time to fill up or answer the Questionnaire.  The responses are quite objective in nature.  There was low rate of return of the dully filled in questionnaire due to the biasness of the respondents.  Few people were not responding as expected from them and they were considering survey a useless activity. 75
  • 76. ` CHAPTER NO. 10 LEARNING EXPERIENCE 76