Be it as exporters or importers, Indian businesses generally don’t hedge against rupee movement vis-a-vis other currencies. Here are the issues at stake

“Chalta hai, yaar.” This is the attitude of Indian business when it comes to forex hedging. Exporters appear to be harbouring the misconception that the rupee is in a structural downtrend and therefore they are unlikely to suffer losses for extended periods. Importers seem to be betting that phases of sharp depreciation will be few. This attitude has cost companies dear in phases when the rupe...