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NT Bureau
Chennai, Oct 14:

        Small and medium enterprises (SMEs) were asked to hedge in future contracts to minimise losses in the export front and focus on emerging markets for their products.

        Delivering a speech at an Open House meet of Federation of Indian Exporters Organisations (FIEO) here recently, R S Gujral, director general of foreign trade, said hedging was an important tool to overcome the challenges faced by a strong and appreciating rupee versus the dollar.

        He said the strong inflow of dollars coupled with a cut in the interest rate by the US Federal Bank had made the rupee stronger which had affected the exporters dearly. Urging the FIEO to set up a nodal cell to study the the counter moves and anti-dumping measures of competing nations and subsidies they offered to their exporters, Gujral welcomed new proposals and suggestions to lessen the adverse impact of the rupee appreciation. 'To make export credit affordable and make them competitive with international rates, the Commerce Ministry had taken up the issue with Finance Ministry and the RBI to lower the interest rates for exporters,' he said.

        FIEO member M Rafeeque Ahmed said exporters were unable to increase the product prices in the global markets as India was being treated as 'minority partner' in the world trade. 'The buyers are ready to source the same type of products from different countries at lower rates if we tried to raise our export products,' he added.

        FIEO vice-president A Sakthivel said that they were finding it extremely difficult to cut costs and increase production due to the appreciation of the rupee which had made Indian products less attractive to global importers. 'We can increase the price only for our long standing customers who would buy our products irrespective of the cost disadvantage,' he said. Another hindrance was that export contracts have to be entered into only in dollars with global buyers and even dealers in Europe were insisting on dollars instead of euro currency.