Dear Members,
 
 It gives me pleasure to present, on behalf of the Board of Directors,
 the 55th Annual Report on the working of the Corporation and Audited
 Statement of Accounts for the year ended 31st March 2011, together with
 the Auditors'' Report and Comments on the Accounts by the Comptroller
 and Auditor General of India (C & AG).
 
 FINANCIAL RESULTS
 
 The overall performance of the Corporation vis-a-vis the previous year
 is summarized in the table given below:
 
                                                    Rs. Crores
 
                                     2010-11        2009-10
 
 TURNOVER
 
 Exports                              492             1504
 
 Imports                            18938            19049
 
 Domestic                             555              956
 
 GRAND TOTAL                        19985            21509
 
 FINANCIAL
 
 Trading Profit                       178              145
 
 Interest Income (Net)                 18              138
 
 Profit Before Tax (PBT)               80              171
 
 Profit After Tax (PAT)                56              107
 
 DIVIDEND                              18             28.5
 
 Net Worth                            679              644
 
 OPERATIONS AND BUSINESS PERFORMANCE
 
 The Corporation achieved a turnover of the order of Rs. 20,000 crore
 during 2010-11 with a trading profit of Rs. 178 crore. The achievement is
 all the more significant as the same has been achieved despite a number
 of factors beyond the control of the Corporation adversely hampering
 trade.
 
 The Profit Before Tax (PBT) during the year amounted to Rs. 80 crore.
 
 DIVIDEND
 
 The Board of Directors have recommended declaration of dividend @ Rs. 3
 per share (30% of equity capital) amounting to Rs. 18 crore for the year
 2010-11.
 
 RESERVES
 
 An amount of Rs. 584 crore was available in the Reserves and Surplus of
 your Company as on 1st April 2010. Your Directors have proposed that
 out of available profits for the year 2010-11, after payment of
 dividend and tax thereon, an amount of Rs. 6 crore be transferred to
 General Reserves of the Company, Rs. 19.18 crore be transferred to
 Export/Import Contingency Reserve and balance profit of Rs. 10.33 crore
 be carried forward as retained profits.  Accordingly, as on 31st March
 2011, the Reserves and Surplus stood at Rs. 619 crore.
 
 FOREIGN EXCHANGE EARNINGS/OUTGO
 
 The total foreign exchange earnings of the Corporation by way of
 exports, trade margins, etc. during the year amounted to Rs. 386 crore
 while the foreign exchange outgo by way of imports and other expenses
 amounted to Rs. 19516 crore.
 
 RECOGNITIONS EARNED/AWARDS WON
 
 During the year, the Corporation earned a number of recognitions and
 awards. These included :
 
 - 14th rank in terms of net sales among 206 PSUs as per Public
 Enterprises Survey : 2009-10 brought out by the Department of Public
 Enterprises.
 
 - 22nd rank in terms of net sales among Top 500 Companies by The
 Financial Express (Feb.''2010).
 
 - 25th rank in terms of net sales among Top 1000 Companies by Business
 Standard (Feb.''2010).
 
 - Won 1st prize under the category of agencies supplying gold to
 exporters against replenishment during 2009-10 from the Gems &
 Jewellery Export Promotion Council in October 2010.
 
 - Won award for Gentle Giant Miniratna - I (Largest Non- Manufacturing
 Company) at the Third DSIJ PSU Awards 2011 ceremony held at New Delhi.
 
 - Won Greentech HR Excellence Award 2010 from Greentech Foundation, New
 Delhi for outstanding achievement in innovation in employee retention
 strategies.
 
 - Won Asia''s Best Employer Brand Award 2010 for Talent Management.
 
 PERFORMANCE OF SUBSIDIARY COMPANY
 
 STCL Ltd. (Formerly Spices Trading Corporation Limited)
 
 STCL, the wholly owned subsidiary of STC, based at Bangalore, is
 involved in import, export and domestic trading of spices and other
 agricultural products.
 
 In view of lack of funds or banking limits, its activities during
 2010-11 remained confined mainly to issuing NOC in respect of onion
 exports and undertaking cardamom auctions.
 
 Annual Accounts of STCL for 2010-11 are yet to be finalised.
 
 As per the accounts for 2009-10, STCL has a negative net worth of Rs.
 1342 crore, due to provisions made towards recoveries outstanding from
 its business associates in merchanting trade transactions undertaken
 during 2007- 08 and earlier.
 
 PERSONNEL
 
 The Corporation had a manpower of 864 as on 31.03.2011.  This included
 536 managers and 328 staff.
 
 During the year, the Corporation recruited 17 Probationary Officers
 with MBA/CA qualifications directly from the Professional
 Institutes/Universities.
 
 Industrial Relations
 
 During the year, the Corporation continued to maintain cordial and
 harmonious industrial relations. No man-days were lost. Mutual trust
 and understanding between the Management and employees was maintained
 through regular consultations held with the representatives of
 employees. This helped in arriving at amicable resolution of personnel
 issues in line with the company''s goals and objectives. During the
 year, the Corporation introduced some new welfare schemes and modified
 certain rules and policies for achieving overall productivity.
 
 Human Resource Development
 
 The Corporation appreciates that Human Resource Development is vital
 for the growth and economic development both at micro and macro levels
 and therefore the Corporation continuously strives to provide maximum
 opportunities to its employees by way of training and field exposures
 enabling them to achieve organizational as well as individual goals.
 During the year, about 620 employees were imparted training in 20
 in-house training programmes organized by the Corporation while 66
 employees were nominated to various external seminars/ conferences. The
 areas of training covered functional, technical as well as behavioural
 aspects such as International Trade, Tax Laws, Finance, Computer
 Operations, Corporate Governance, Vigilance, Attitude Building, Stress
 Free Living and Work Life Balance. For the first time, the Corporation
 organized specially customized Management Development programmes on
 ''International Trade and Finance'' in association with Administrative
 Staff College of India (ASCI) for the benefit of senior and middle
 level managers. STC is conscious of the need to nurture the talents of
 young executives so as to help them face the challenges in the future.
 Under a comprehensive and custom-built induction programme organized by
 STC at IIFT, New Delhi, all the new Probationary officers who joined
 the Corporation during the year were given exposure to the intricacies
 of International Trade. The young executives were also given an
 opportunity to represent STC at the National level game competitions.
 
 Recruitment of SC/ST/OBC and Physically Challenged Persons
 
 The Corporation has been implementing the policies and guidelines
 issued by the Government of India from time to time with regard to
 recruitment of SC/ST/OBC and physically challenged candidates. During
 the year, 3 SC, 1 ST, 3 OBC and 1 physically challenged (PH) candidates
 were recruited.
 
 OFFICIAL LANGUAGE
 
 The Corporation makes best efforts to implement the Official Language
 Policy of the Govt. of India and promotes use of Hindi in its day to
 day working in line with the directions of the Ministry of Home
 Affairs. During the year, meetings of the Departmental Official
 Language Implementation Committee and Hindi Workshops were organized
 from time to time. On the occasion of Hindi Divas, awards were given to
 selected employees / divisions at Corporate Office and Branches for
 outstanding work in Official Language.
 
 In appreciation of the progress of Official Language work in the
 Corporation, Ministry of Commerce has felicitated it with 1st prize
 many a time. In this series, STC was awarded Rajbhasha Shield by the
 Hon''ble President of India for outstanding work in Official Language
 during 2009-10. The Official Language related work at STC''s Corporate
 Office and Branches is examined by the Parliamentary Committee on
 Official Language from time to time. The Third Sub-Committee of the
 Parliamentary Committee on Official Language inspected STC''s Corporate
 Office last year and appreciated the performance of its Official
 Language related work. STC always endeavours to propagate and increase
 the use of Official Language under the Official Language Policy of the
 Govt. of India.
 
 VIGILANCE ACTIVITIES
 
 The Vigilance Division of the Corporation performed the following
 Vigilance functions during the year:
 
 - With a view to creating greater awareness, amongst employees, of the
 need for eradication of corruption and maintenance of high standards of
 integrity, Vigilance Awareness Week was observed in STC''s Corporate
 Office and Branch Offices from 25th October to 1st November 2010. As
 part of observance of the week, a seminar on ''Preventive Vigilance'' was
 organized in the Corporate Office during which a presentation on ''Risk
 Management in the context of International Trade'' was made by the CVO.
 An interactive session on ''System Improvement in STC to Minimize Risks''
 was also conducted with the senior officials of STC. Besides, various
 programmes relating to vigilance awareness and anti-corruption were
 also organized at the Branch Offices.
 
 - In-house training programme was organized on ''Vigilance Role and
 Mechanism'' for Probationary Officers.
 
 - Complaints received from various agencies / sources were duly
 investigated.
 
 - Departmental inquiries having vigilance angle were handled.
 
 - Constant liaison was maintained with various agencies for ensuring
 preventive vigilance and providing details/ inputs to regulatory
 agencies as per statutory requirements.
 
 - Inspection of the Branch Offices of the Corporation was conducted
 thereby bringing various aspects to the attention of top management for
 taking corrective/ preventive action.
 
 PARTICULARS OF EMPLOYEES
 
 A statement of the employees of the company drawing remuneration
 exceeding the limit laid down under provisions of section 217 (2A) of
 the Companies Act, 1956 read with the Companies (Particulars of
 Employees) Rules 1975 as amended is placed at Annexure-I.
 
 CORPORATE SOCIAL RESPONSIBILITY
 
 During the year, your Corporation undertook a number of CSR activities
 in fulfilment of its obligations in terms of the guidelines on
 Corporate Social Responsibility (CSR) notified by the Department of
 Public Enterprises, as per details in Management Discussion & Analysis
 Report.
 
 CONSERVATION OF ENERGY, TECHNOLOGY ABSORPTION, ETC.
 
 The information required to be disclosed in accordance with the
 Companies (Disclosure of Particulars in the Report of Board of
 Directors) Rules, 1988 is ''nil'' as the company is mainly engaged in
 trading activities.
 
 MANAGEMENT DISCUSSION AND ANALYSIS REPORT
 
 In terms of clause 49(IV) (F) of the Listing Agreement with the Stock
 Exchanges and Guidelines on Corporate Governance for Central Public
 Sector Enterprises (CPSEs) issued by the Department of Public
 Enterprises, Govt. of India, a Management Discussion and Analysis
 Report is placed at Annexure - II which forms part of the Annual Report
 of the Company.
 
 FINANCIAL ACCOUNTING
 
 The Financial Statements have been prepared in accordance with the
 Generally Accepted Accounting Principles (GAAP) and in compliance with
 all applicable Accounting Standards (AS-1 to AS-29) issued by The
 Institute of Chartered Accountants of India (ICAI) and provisions of
 the Companies Act, 1956.
 
 CORPORATE GOVERNANCE
 
 Your Company remains committed and dedicated to adoption of best
 corporate governance practices, aiming at greater transparency,
 accountability, performance orientation, honesty and integrity.
 
 In terms of Clause 49 of the Listing Agreement and Guidelines on
 Corporate Governance for CPSEs issued by the Department of Public
 Enterprises in May 2010, a report on Corporate Governance for the year
 2010-11, supported by a certificate from the Company''s Auditors
 confirming compliance of conditions, forms part of this report
 (Annexure - III).
 
 STC complies with the requirements stipulated under DPE guidelines for
 Corporate Governance for CPSEs and clause 49 of the Listing Agreement
 with Stock Exchanges except the Clause 49 (1A) of the listing agreement
 and para 3.1.4 of the DPE guidelines for Corporate Governance regarding
 number of Independent Directors on Board. Action in this regard is
 being taken by the Ministry of Commerce & Industry and the process of
 appointment of requisite number of Independent Directors is already on.
 
 AUDITORS
 
 M/s Chandiok and Guliani, Chartered Accountants were appointed as
 Statutory Auditors for the financial year 2010- 11 by the Comptroller &
 Auditor General of India (C&AG).  Their report, along with replies of
 the Management, is attached as addendum forming part of this report.
 
 COMMENTS OF C&AG
 
 The comments of C&AG under Section 619 (4) of the Companies Act, 1956
 on the accounts of the Corporation for the year 2010-11 are attached
 and form part of this Report.
 
 DIRECTORS'' RESPONSIBILITY STATEMENT
 
 Pursuant to the requirement under section 217 (2AA) of the Companies
 Act, 1956, with respect to Directors'' Responsibility Statement, it is
 hereby confirmed that:
 
 - In the preparation of annual accounts, the applicable accounting
 standards have been followed along with proper explanation relating to
 material departures;
 
 - The Directors have selected such accounting policies and applied them
 consistently and made judgments and estimates that are reasonable and
 prudent so as to give a true and fair view of the state of affairs of
 the company as at 31st March, 2011 and of the profit or loss of the
 company for the year ended on that date;
 
 - The Directors have taken proper and sufficient care for the
 maintenance of adequate accounting records in accordance with the
 provisions of the Companies Act, 1956, for safeguarding the assets of
 the Company and for preventing and detecting fraud and other
 irregularities; and
 
 - The Directors have prepared the annual accounts of the Company on a
 ''going concern'' basis.
 
 BOARD OF DIRECTORS
 
 During the year, Shri Saurabh Chandra, Additional Secretary & Financial
 Adviser, Ministry of Commerce was appointed as Part-time Official
 Director on the Board of STC vice Dr. Sutanu Behuria w.e.f. 10.11.2010.
 Subsequently, Dr. Rajan Katoch, Additional Secretary & Financial
 Adviser, Ministry of Commerce, was appointed as Part-time Official
 Director on the Board of STC vice Shri Saurabh Chandra w. e. f.
 15.12.2010. Your Directors place on record their deep appreciation for
 the valuable contributions made by Shri Sutanu Behuria and Shri Saurabh
 Chandra during their tenures.
 
 Dr. Rajan Katoch, who was appointed as Additional Director after the
 last AGM, holds office up to the ensuing AGM. Also, three new
 independent Directors, namely, Sh.  Proshanto Banerjee, Prof. R.H.
 Dholakia and Sh. Naresh Dayal have been appointed as Additional
 Directors on the Board w.e.f. 24.06.2011. They will hold office upto
 the ensuing AGM.
 
 Pursuant to the provisions of Section 255 and 256 of the Companies Act,
 1956 and in terms of provisions of article 89 (2) of the Articles of
 Association of the Corporation, Shri S.S. Roy Burman and Shri M.M.
 Sharma would retire by rotation at the ensuing Annual General Meeting
 (AGM) and being eligible, have offered themselves for re- appointment.
 
 Brief resumes of all Directors seeking Appointment/ Re- Appointment, as
 stipulated under Clause 49 of the Listing Agreement with the stock
 exchanges are given in the Annexure to notice convening the 55th Annual
 General Meeting of the Company, and form part of the Annual Report.
 
 CODE OF CONDUCT
 
 Pursuant to clause 49 (1) (d) of the Listing Agreement signed with the
 Stock exchanges and Guidelines on Corporate Governance for CPSEs issued
 by the Department of Public Enterprises, a detailed Code of Conduct for
 Board Members and Senior Management Personnel has been laid down and
 hosted on the website of the Company. All Board Members and Senior
 Management Personnel, to whom the said Code is applicable, have
 affirmed compliance of the same for the year ended 31st March 2011.
 
 ACKNOWLEDGEMENTS
 
 The Board of Directors places on record its appreciation of the
 continued patronage and the confidence posed by business associates and
 customers during the year. The Board is grateful for the continued
 guidance and support received from the Ministry of Commerce & Industry,
 Ministry of Food, Consumer affairs & Public Distribution, Ministry of
 Chemicals and Fertilizers, different State Governments, various Govt.
 Departments and Agencies, Banks and Financial Institutions, Railways,
 Ports, Legal Advisers, Consultants and Shareholders. The Board also
 acknowledges with thanks the suggestions received from Comptroller &
 Auditor General of India, Statutory Auditors and Internal Auditors.
 
 Last but not the least, the Board also acknowledges the unstinting
 efforts and contribution made by the employees at all levels without
 which it would not have been possible for your company to achieve such
 high volumes of business on a sustained basis.
 
 For and on behalf of Board of Directors
 
 Sd/-
 
 (N.K. MATHUR)
 
 Chairman & Managing Director
 
 New Delhi
 
 Date : 02.08.2011