What are the other categories of persons in need of protection not Essay

What are the other categories of persons in need of protection not defined in the 1951 Refugee Convention and the 1967 Protocol - Essay Example It dictates the available solution for refugees as exile. On the contrary, we are in a different era where refugees problems can be properly handled and rule out exile. In this regard, dialogue can rule out or provide alternative amicable solutions to refugees. The Refugee Convention of 1951 and the 1967 Protocol covers widely the rights of the refugees in the entire world (Miller, 2014). However, the convention and its protocol fail to cover other groups of the vulnerable and the disadvantaged. These groups are the victims of female genital mutilation, child hunger, child recruitment into illegal militia, sex abuse victims, among others (Antoinette, 2010). The convection states that it does not provide permanent protection to refugees. This implies that when the refugee status of a person expires, he or she is venerable to other crimes such as sexual abuse and hunger. The 1951 refugee convention and 1967 protocol are to be The convection however, has its fair share of limitations that emphasis more on the need to have the convection revised. For instance, the convection denies the refugees and ‘camp’ refugees equality (Miller, 2014). More preference is given to those present instead of preference being based on the neediest. Furthermore, the convection also does not take into account factors accruing to the refugees as a result of political, financial or social factors. The convection based asylum deemed to be most efficient during the Cold War (Miller, 2014). Applying the same convection today has proved futile in seeking to solve some of the challenges faced by the asylum seekers. The convection fails to factor in mass asylum seekers outflows as well as their migratory movement patterns. The 1951 convection is very clear on the persons it protects. The convection clear defines refugees as a person who has freed his or her country due to risk of facing prosecution because of race, political opinion or religion. The 1967

Israel-Palestine Conflict over Gaza Research Paper

Israel-Palestine Conflict over Gaza - Research Paper Example The effect of this conflict has raised concerns among international stakeholders as well as other nations like the United States of America (Sterio 2010). Deterioration of Socio-economic factors Despite the efforts placed by the concerned stakeholders as well as the leaders of the affected nations, there has been little success as the conflict continuously affects various facets of the society. Apparently, various researchers and reports have shown that the most affected region is the Gaza strip where; lots of lives have been lost; properties, as well as other social amenities, have been affected (Mandell 1985). Tribal Conflicts in Palestine The occurrence of conflicts between the Palestine tribes has also created a major setback on the efforts of the international community that has been placed to facilitate peace negotiation between the two countries. Conflicts between the Sunnis and the Shiites have created divisions among the Palestine leaders hence diverting their attention from the peace negotiations towards resolving these internal conflicts (Migdalovitz 2010). Discussion Israel- Palestine Conflict Various social researchers as well as other concerned International Stakeholders have undertaken studies to find the causes of the Israeli and Palestine conflict. The most obvious factor that has emerged is that the conflicts were triggered by the struggle on who owns Gaza; however, bodies such as the media have failed to provide comprehensive information concerning the causes of conflict between the two nations. That is, there are cases where the media has portrayed Israel as an innocent nation that is making an attempt to save aggressive Palestine from causing harm to its citizens. This has raised a lot of concern from the various stakeholders, especially among the Palestine leaders. Escalation of the Israeli-Palestine war International Organizations such as the United Nations, World Health Organizations as well as other stakeholder countries has made differ ent efforts to ensure that peace and stability exist between the two nations. However, their efforts have not been successful owing to a number of reasons. The first reason emerges from the inter-ethnic group among the Palestine Tribes; these tribal conflicts have been propagated by the differences emerging the specific inter-ethnic affiliations. That is, certain groups such as the Shiites have experienced tremendous hatred from the Sunnis who have perceived them to be affiliated with Iran. On the other hand, the death of certain key Muslim leaders as a form of revenge has also been another factor. These factors have propagated the occurrences of Israeli-Palestine Conflict mainly because they have jeopardized the efforts placed by stakeholders to create peace (Cowley 2012).

Heart of Darkness vs Things Fall Apart Essay Example for Free

Heart of Darkness vs Things Fall Apart Essay â€Å"Heart of Darkness† and â€Å"Things Fall Apart† show a variety of ways of depicting Africa in literature. In â€Å"Heart of Darkness†, Joseph Conrad shows the continent of Africa through the stereotypical perspective of the European sailors, who had a tendency to depict the natives of the land as savages, and in response to that matter, Chinua Achebe wrote â€Å"Things Fall Apart† through the non-stereotypical depicting perspective of the natives of the land to show Africans, not as savages or primitives, but as members of a traditional society. European prejudice is presented in a verifiable way in â€Å"Heart of Darkness†. The main character of â€Å"Heart of Darkness† or protagonist, Marlow, is a sailor who travels through Africa and describes the natives that he comes in contact with as savages. Marlow compares these different individuals to animals of some specific nature or just to the wilderness of the jungle, respectively. There was a point in this novel where Marlow’s vision came in contact with a pit in the ground. He noticed that it was a pit made for the natives to go and rest in peace or in other words die. Marlow describes those natives that were there stating, â€Å"Black shapes crouched, lay, sat between the trees, leaning against the trunks, clinging to the earth in all attitudes of pain, abandonment, and despair they were nothing earthly now, nothing but black shadows of disease and starvation One of these creatures rose to his hands and knees and went off on all fours towards the river to drink† (Conrad 17). This descriptive portrayal shows the natives as â€Å"shadows† and nothing more than mere â€Å"black shapes† and not as individuals or men who are simply just dying. These men are no longer men, they have been stripped of all their characteristics which makes them human to dehumanizing characteristics where none can tell the difference of one dying man to another. None of the dying men are described by oneself, which makes it difficult for the reader to see where one man ends to where the individual begins. This creates an effect where these individuals look like eometric shapes and symbols of some sort. These depictions in which Marlow stated originates from a very stereotypical saying. The saying is that all Africans are made the same and one can not tell the difference between them even if much effort is applied. Similarly, there was an African man who was crawling to the river in order to quench his thirst. The way he was crawling in general is very dehumanizing. To make the matter worse and more dramatic, he crawled on his hands and knees which is animal-like and very degrading. The man is described to be on all fours just to get a drink, but when looking towards the European side, there is no way in Heaven that they’d be described like that. None. On the other hand, the European people would drink from a tap or maybe boil water from a well of some sort in order to have a refreshing drink. The natives are compared to animals of the wild when Marlow begins describing one of the workers on the ship. Marlow states, â€Å"to look at him was as edifying as seeing a dog in a parody of breeches and a feather hat walking on his hind legs† (Conrad 36). This worker simply shows that the savages who are the Africans have a possibility of being tamed because, â€Å"He ought to have been clapping his hands and stamping his feet on the bank† (Conrad 37). One can see that this man has been stripped of being a human being. He is now an animal, a dog, maybe, who is being trained to do some type of trick. From Marlow’s point of view he is still an animal and none the less, this man is pretending to be a civilized being. Marlow doesn’t stop there though. He continues to downgrade this European man by describing him to be just like the natives on the land. All in all, this is stereotypical. Furthermore, Marlow keeps his ball rolling by depicting the African natives as â€Å"prehistoric† and â€Å"simple†. He states, â€Å"The prehistoric man was cursing us, praying to us, welcoming us who could tell? we glided past like phantoms, wondering and secretly appalled, as sane men would be before an enthusiastic outbreak in a mad house† (Conrad 35). In the mind of Marlow, the natives are so primitive that they are in an aspect denied of having a language. Marlow sits there and begins to wonder â€Å"who could tell? instead of making an effort to understand what the natives were saying out of their mouth. What can actually be inferred from this quote is that, the natives were probably jumping up and down like a bunch of kindergarten students at recess or something similar to that. One can’t really be sure, but in all Marlow didn’t even try to grasp what the native Africans were saying probably because he felt that they were savages, or maybe their intellectual mindset wasn’t as great and average to the Europeans, or the native Africans didn’t have anything reasonable to say. Joseph Conrad with respect and similarity to Marlow, may have chosen to not include a specific language probably because he was influenced by the European stereotypes of Africans. What can be inferred from this is that, the removal of a language suggests that the native Africans have nothing that is sophisticated enough to say that would be reasonable or important to add to the plot of the novel. In â€Å"Heart of Darkness†, the native Africans are very underdeveloped, just like a third world country would be, in order to have a control of language. Though, there are moments in which there is language which supports the native savage (Africans) at which this is the time a reader might even hear an African speak. Joseph Conrad uses a specific technique when he writes. He uses a limited exposure to the native Africans’ voices which tries to ignore anything that might bring stereotype about. In response to Joseph Conrad and the Europeans and their use of stereotypical depiction of Africans, Chinua Achebe, the author of â€Å"Things Fall apart† portrayed Africans in a humanizing and traditional society. The Igbo tribe goes against the European stereotype in â€Å"Things Fall Apart†. The main character or protagonist Okonkwo does not agree nor does he disagree with the European belief that is shown in the novel. He is described in the novel to be, â€Å"a man of action, a man of war† (Achebe 8). Okonkwo is a very honorable man in the Umofia village, even though he has a very displeasing streak which is of violent nature. With Okonkwo’s strength and inability to be feminine, he is afraid of anything that is of feminine nature. â€Å"His whole life was dominated by fear, the fear of failure and of weakness. It was the fear of himself, lest he should be found to resemble his father. Even as a little boy, he resented his fathers failure and weakness. And so Okonkwo was ruled by one passion to hate everything that his father Unoka had loved. One of those things was gentleness and another was idleness† (Achebe 10). What can be inferred from this quote is that, this is probably why Okonkwo was always in need of something that was filled with action but he still didn’t fashion â€Å"idleness†. With the combination of these two aspects, Okonkwo can not handle the outcome. Instead when violence is applied to this equation, Okonkwo is as good as can be. With this being said, this further supports the European stereotype as savage-like. When looking deeply into the details that â€Å"Things Fall Apart† display, one can notice the contrasting aspects between Umofia and Okonkwo. Okonkwo doesn’t have any respect for his wives. As an Igbo man, Okonkwo man-handles his wives and children without holding back. Noticing the tone at this point in the novel, one can see that it is very much common for Igbo men in general to beat the ripe bananas out of their wives and children, but at a certain time. Okonkwo man-handled his wife during Umofia’s Week of Peace. Beating your wives and children in order for them to have respect for you is one thing, but when one disobeys the traditional setting of the clans week of peace then drastic problems do arise. â€Å"Okonkwo was not the man to stop beating somebody half-way through, not even for fear of a goddess. It was unheard-of to beat somebody during the sacred week† (Achebe 19). Since Okonkwo felt as if he was the man on top of all and that he could do as it pleased him so, problems arose between himself and Umofia. The feminine force is his wife. And with that being noted, Okonkwo could not remove himself from his violent streak for even a week. Just a week†¦ but when comparing this to the perspective of â€Å"Heart of Darkness† this form and lack of self-control goes to the Europeans motive that Africans are savages. Towards the end of the novel, Okonkwo commits suicide by hanging himself. When the District Commissioner look at Okonkwo’s lifeless body, he states â€Å"In the book which he planned to write The story of this man who had killed a messenger and hanged himself would make interesting reading. He had already chosen the title of the book, after much thought: The Pacification of the Primitive Tribes of the Lower Niger† (Achebe 117). What can be inferred from the title of the book is that the District Commissioner is prejudiced about the native Africans. In â€Å"Heart of Darkness†, Africans are also described as â€Å"primitive†, which shows that the European’s stereotype is so vast that it is able to be used in two very separate and different works. All in all, in â€Å"Heart of Darkness† the Europeans notions was that all Africans are the same; they are primitive, savages, and inhuman. In contrast to that stereotype, â€Å"Things Fall Apart† showed a traditional society, where the members are not inhuman. Unsatisfactorily, Okonkwo who is the protagonist of â€Å"Things Fall Apart† was not an effective representation of a civilized individual of a traditional society. But, he was an exceptional member of the society. And even though the stereotype of Africans has not been destroyed, it empowers the European beliefs.

If you were directing the play a view from a bridge what Essay

If you were directing the play "a view from a bridge" what advice would you give to the actor playing Eddie about his character? Use quotations and close reference to the text. "A view from a bridge" is a play with five main characters. Eddie and Beatrice are married whilst they adopt Catherine, who is Eddie's niece. Marco and Rudolfo are their cousins who come to stay from Sicily. They are both illegal immigrants. A situation in the play occurs where Eddie becomes possessive of Catherine while Rudolfo plans to marry her. From the director's point of view advice to the actor playing the part of Eddie is complicated, but crucial. If I was the director looking for an actor to play Eddie it would have to be a man in his forties because that is most likely to be approximately the age of a man who has a niece the age of seventeen. Eddie is a longshoreman in the play and it would make sense if the actor was well built. In the film we watched Eddie had no real muscle definition. Also the play we watched Eddie seemed to sit in the same seat all the time. This shows that the character of Eddie was perceived as lazy, I did not think this was the case because of his active job. I would tell the actor to be more dynamic, energetic and move about the stage more, especially when he gets frustrated. The play was set in the nineteen fifties so Eddie would be told by me to dress appropriately. Eddie should wear old rugged clothes because of the limited income provided by his job. This brings me to Catherine who, in the film we watched was definitely overdressed and too clean for the circumstances she lives in. Another big aspect I would give advice to the actor about is his relationships with other characters. In the play we watched it was hard to comprehend the part where Eddie's innermost feelings for Catherine were exposed. This was the scene where Eddie came home drunk and found Rudolfo in Catherine's room. To make the scene more believable Eddie should show more love for Catherine. He should do this through body language. His facial expression should show over concern and love for Catherine or he could stare gapingly at her body. The play we watched the actors face was expressionless and all he did was say his lines whilst sitting in a chair. That was not enough. Although curiosity should be put across to the audience it should... ...s when he has the urge to be a macho and man of the house. Also respect is the most important thing and is greatly valued, this explains Eddie's behaviour towards the end of the play. I think that the background culture should be kept in mind because part of the specification is a strong macho man capable of a convincing accent and not slouching or looking lazy. In the play we watched Eddie sat in the same chair too much so either a younger is needed or an actor that looks dynamic at least. Also a good point is to advise the actor to walk about the stage when Eddie seems to struggle to express feelings through his limited vocabulary. Eddie's character shows stubbornness. He shows that attribute throughout the play and does not expect his family to correct him on anything he has already stated. I also think that when he releases bottled up emotions, like in the situation when he comes home drunk the actor should exaggerate his facial expressions. In the play we watched Eddie's face was expressionless showing poor acting, which was disappointing. As the play progresses Eddie seems to lose his mind, and also at one point he loses his sense of Sicilian justice.

Romeo and Juliet Diary Entries

Dear diary, as it is the first time I am writing to you, I would like to tell a little concerning myself. My name is Romeo, and I come from the Montague family, with my dad Mr. Montague and my mum Lady Montague. I am sixteen. Not that I have a high regard for myself, but I have to say that I am quite attractive, bright and sensitive. I live in the middle of a fierce fight between my family and the Capulet’s. This battle has started ages before I was born, and will keep on going for generations and generations. Sincerely, I think that this fight is foolish, and that violence doesn’t make thing different and by no means will between our two families. I take the Capulet’s as equal to us, and nothing will alter my mind. I feel that this day couldn’t get any worst for me. You see I like this girl from the name of Rosaline, but she doesn’t return her affection towards me. This made me miserable for the whole day, and I had not the desire to see any people. I went around the region, and went into profound thinking and came to the point that there was no more point of breathing if I could never get will my beloved Rosaline. The only person informed about my love for her is my dearest cousin â€Å"Benvolio†. I told him how I felt, and how I couldn’t live without her, and he gave me the advice of going with him tonight at the masked party at the Capulet’s mansion. Dear diary I hope my cousin is right and if not what should I do? 21 April Dear diary, I am writing to tell you that I have forgotten about Rosaline in my heart and that at ball, at the Capulet’s I have fallen in love, from the first moment I saw her, and she unclasp my heart, and treed it from the thing I thought I loved and fixed it only on her. You see the moment I laid sight upon her; she engulfed my feelings upon her, and made me forget about Rosaline. The only shocked I had was after the tender kissed I got from laying my lips on hers, was that I later on learned that she was a Capulet. She is a thirteen-year-old girl, she is one of the most gorgeous girls I have ever laid eyes on, and her eyes reminded me of starts lighting upon a dark night. Even though she is of the enemy family, I thought that in any cases love was possible, and that without letting both siblings know I could forever be with her, and that in any cases we could run away together. On that night, after the ball, I have left both Benvolio and Mercutio and went climbing up her balcony, and from both side we exchanged our vows. When she was done with hers, I stopped her mouth with a kiss after having heard enough, and my heart was beating so fast that the night with her passed so fast till the moment I had to leave, which made it hard to take out my sight upon her perfect shadow. 25 April A few days later, I had gone through some with Juliet, and I finally think she is the one I want to be with. I hurried early in the morning to Friar Laurence who for me is some kind of second father, and at the same time a best friend which I tell everything to. He is quite old, and works in a small church in the middle of a field of roses. When I arrived their, I jumped in his arm, and him exited to see me, I thought it would be a good moment to actually express my feelings for Juliet. But after I have told him that I have no more feeling for Rosaline, but for the Capulet’s daughter, he turned his head away from me, and kept on walking. He then stopped and told me that what I am doing will just make the relation between both family more complicated, but the more he thought of it, the better it was for both families, so he agreed to the marriage, and on very special day we got married. 27 April Dear diary, after I have thought that nothing could ruin the joy that I had in my heart for a couple of days, well it actually did. When I went to see Benvolio and Mercutio to tell them some of the good news, well there was a fight going on in the center of the village. Tybault, which is Juliet cousin, came to our territory, and asked for trouble, and Mercutio which could not refuse a fight, decided to fight against Tybault, which I tried to make it not happen, but by falling, the fight ended by dearest Mercutio to die in my hand from Tybaults sword. Without any pretoughts, I rushed to Tybault and killed him as revenge towards Mercutio. And this is when everything turned into hell. As the prince kept on saying, that if by any means a fight was happening between then two families, the one responsible was ask to be killed. So after having killed Tybault I thought that the best idea was to flee and go hide somewhere outside the region where nothing could happen. But would Juliet be ok? How would she get any of my news? What should I do? 02 May It as been five days since I didn’t see my beloved Juliet, and I am going crazy without her. I keep asking myself those questions, if everything is ok on her side. I would do anything to go back in the past and change the fight which happened. Friar told me that I should stay where I am and not move till I get a letter from him, telling me that everything would be back as usual, except that I would have to run away with my love. I would do anything to see her again, I wouldn’t mind running away till the other side of our planet. The only thing I now must be worried about is whether she is ok, and if everything will go according to plan. I have sent a loyal friend to look on Juliet while I stay and hide in the hut which I am standing in right now, and see whether everything is ok on her side. But when he came back a couple of minutes earlier, he told me that he saw Juliet dead†¦When I heard that I thought that I was gone for, I was already seeing the life falling behind me and that it is impossible that this could have happened. So without the Friar letter, I will think I would have to go to the graveyard and see whether what I heard is in fact true. Next time I will be writing in this diary I would tell how I in fact managed to run away with my Juliet and that we would for ever live happily ever after.

Past Subjunctive in English Definition and Examples

Past subjunctive is a term in traditional grammar for the use of were in a clause that expresses an unreal or hypothetical condition in present, past, or future time (for example, If I were you . . .). Also known as the were-subjunctive and the irrealis were, the past subjunctive differs from the past indicative only in the first- and third-person singular of the past tense of be. The past subjunctive is primarily used in subordinate clauses that begin with (as) if or though. Examples and Observations [Her eye] was prominent, and showed a great deal of the white, and looked as steadily, as unwinkingly, at you as if it were a steel ball soldered in her head.(Charlotte Brontà «, Shirley, 1849)If she were truly sorry or even not sure she was right, she might apologize, but in this case shed be lying.(Cliff Coon, The Mending String, 2004)How can a person start off from Grand Isle to Mexico at a moments notice, as if he were going over to Kleins or to the wharf or down to the beach?(Kate Chopin, The Awakening, 1899)I always feel a little uneasy when Im with Marie Strickland, though not uncomfortable enough to wish she werent here.(P.D. James, The Murder Room, 2003)Suppose he were to come back to Paris and challenge Bunny to a duel?(Upton Sinclair, Oil! 1927)O would that she were here,That fair and gentle thing,Whose words are musical as strainsBreathed by the wind-harps string.(G.P. Morris, Lines for Music) An Untensed Form The meaning of the past subjunctive is not factual but counterfactual (e.g. [ I wish] he were here; If I were you . . .) or tentative (e.g. I would be surprised if he were to do that). . . .[T]he subjunctive were is not a relative tense form. Since, obviously, it is not an absolute tense form either (i.e. it does not relate its situation to the temporal zero-point), it can only be treated as an untensed form. In this respect, it resembles nonfinite verb forms, i.e. infinitives, participles, and gerunds. (Renaat Declerck, Susan Reed, and Bert Cappelle, The Grammar of the English Tense System: A Comprehensive Analysis. Mouton de Gruyter, 2006) Formal Usage When the past subjunctive is used, a reference to a hypothetical or to a counterfactual situation is made, which may lie in the present, the past or the future (Example 10): (9) you could read page one-twenty-four, as if it were all simple past, right?(MICASE LEL300SU076)(10) [...] Jimmie wishes/wished/will wish his girlfriend were with him.(example by Depraetere Reed 2006: 271) The form were is used especially following constructions that express volition, such as the verbs wish and suppose (I wish he were here), the conjunctions as if, if only, as, though, whether (if I were you . . .), and the phrases would rather and would that (would that he were still alive). In non-formal contexts, however, the past form is often replaced by the past indicative was (I wish he was here) (Huddleston Pullum 2002: 86-89; Quirk et al. 1985: 148; 1013), i.e. modal preterite. So the past subjunctive counts as the more formal variant. (Alexander Bergs and Lena Heine, Mood in English. Mood in the Languages of Europe, ed. by Bjà ¶rn Rothstein and Rolf Thieroff. John Benjamins, 2010) Correctness and Acceptability Acceptability is not absolute, but is a matter of degree; one expression may be more or less acceptable than another. If I were in your shoes may be judged more acceptable than If I was in your shoes, but both are considerably more acceptable than If we was in your shoes. Moreover, acceptability is not abstract, but is related to some group of people whose response it reflects. (John Algeo and Thomas Pyles, The Origins and Development of the English Language, 6th ed. Wadsworth, 2010)

Study On Currency Risks Handled By Indian Firm Finance Essay - Free Essay Example

Sample details Pages: 10 Words: 3000 Downloads: 6 Date added: 2017/06/26 Category Finance Essay Type Cause and effect essay Did you like this example? The objective of this project is to examine how the impacts of currency exchange risks are dealt by the Indian Firms. Currency Exchange Risk in Global Market is a burning issue for any firm or corporate involved in business overseas. In this scenario, India is of course the one country where we have a lot of scope to focus on as far as the study of currency risk in business is concerned. Don’t waste time! Our writers will create an original "Study On Currency Risks Handled By Indian Firm Finance Essay" essay for you Create order If we see the world wide scenario, the financial sector is facing a lot of adjustment problems in the rapid changes in the economic financial environment. Now Indian financial system cannot be indifferent to this universal phenomenon. I would like to take the example of the Indian IT giants with special emphasis on TCS, in this exploratory paper to see how the currency swings affected the business of TCS in last couple of years and would try to provide some supportive data to show the same. It is very interesting to see how the companies like TCS uses different derivative instruments to keep the sustainability of its performance in the financial market by hedging the financial risks, specially related to the volatility of the money market and foreign currency exchange rates. How Companies use Derivatives for Hedging Risk Management Hedging Hedging, in simple words, says controlling or reducing risk. This controlling or reducing risk is done by taking a position in th e futures market that is opposite to the one in the physical market with an objective to reduce or limit risks associated with price changes. A simple example will help us understand it better. A wheat farmer can sell wheat futures to protect the value of his crop prior to harvest. If there is a fall in price, the loss in the cash market position will be countered by a gain in futures position. 2.2. Derivatives Derivatives are those financial instruments whose values depend on the value of not only the underlying financial instruments but on any underlying asset. We can take the same example of the wheat farmer. Here, the wheat farmer can protect itself of any fall in price by entering into a contract with the merchant. Some of the derivative instruments are: Futures, Swap, Options, and Forwards. To summarize, Hedging can be defined as a method where one can reduce the financial exposure faced in an underlying asset due to volatility in prices by taking an opposite position in the derivatives market in order to off-set the losses in the cash market by a corresponding gain in the derivatives market. This above definition captures the basic essence of derivatives hedging. Now having understood the basic meaning of hedging and derivatives, we would now see how corporate use these derivative instruments for hedging. 2.3. Foreign Exchange Risks The most common corporate uses of derivatives is for hedging foreign-currency risk, or foreign exchange risk, which is the risk that a change in currency exchange rates adversely impacts business results. Lets consider an example with Infosys Technologies, a multi-national IT company which even exports soft wares to other countries, and mainly to US. Lets make an assumption that Infosys Technologies exports software worth 1000 Crores to US in 2006-07 when the price of per US Dollar was at Rs. 40 (assumption). When the rupee per dollar exchange rate increases from Rs. 40, Rs. 42, Rs. 44, it takes more rupees to buy one dollar, meaning the rupee is depreciating or weakening. As the rupee depreciates, the softwares which Infosys exports would translate into greater sales in rupee terms. This demonstrates how a weakening rupee is not all that bad: it can boost export sales of Indian companies. Now lets illustrate a simple hedge that a company like Infosys Technologies might us e to minimize the effects of any Rupee / USD exchange rates, Infosys purchases 2000 foreign-exchange futures contracts against the Rupee / USD exchange rate. The value of the futures contracts will not, in practice, correspond exactly on a 1:1 basis with a change in the current exchange rate (that is, the futures rate wont change exactly with the spot rate), but we will assume that it does anyway. Each futures contract has a value equal to the gain above the Rs. 40 Rupee/USD rate. (Only because Infosys took this side of the futures position, somebody the counter-party will take the opposite position.) Of course, its not a free lunch: If the strategy of Infosys goes against it, that is, if the dollar were to weaken instead, then the increased export sales are mitigated (partially offset) by losses on the futures contract. 2.4. Hedging Interest Rate Risks Companies can hedge interest-rate risks in various ways. Consider a company that expects to sell a division in one year and at that time to receive a cash wind-fall that it wants to park in a good risk-free investment or a company had an unexpected profit, if the company strongly believes that interest rates will drop between now and then, it could purchase (or take a long position on) a treasury futures contract. The company is effectively locking in the future interest rate. Fair Value Hedges The Company [XYZ] had two interest rate swaps outstanding at January 1, 2008 designated as a hedge of the fair value of a portion of fixed-rate bonds. The change in fair value of the swaps exactly offsets the change in fair value of the hedged debt, with no net impact on earnings. XYZ Company uses an interest rate swap. Before it entered into the swap, it was paying a variable interest rate on some of its bonds. (For example, a common arrangement would be to pay LIBOR plus something a nd to reset the rate every six months.) Now lets look at the impact of the swap, the swap requires XYZ to pay a fixed rate of interest while receiving floating-rate payments. The received floating-rate payments are used to pay the pre-existing floating-rate debt. XYZ is then left only with the floating-rate debt, and has. Therefore, managed to convert a variable-rate obligation into a fixed-rate obligation with the addition of a derivative. Here we can call this as a perfect hedge: The variable-rate coupons that XYZ received compensates for the companys variable-rate obligation. 2.5. Commodity or Product Input Hedge Companies that depend heavily on raw-material inputs or commodities are sensitive, sometimes significantly, to the price change of the inputs. Airlines, for example, consume lots of jet fuel. Historically, most airlines have given a great deal of consideration to hedging against crude-oil price increases although they need to be very careful and a great forecasting before going for such a strategy because the strategy itself would cost them a lot. As we reviewed here three of the most popular types of corporate hedging with derivatives. There are many other derivative uses, and new types are being invented. The derivatives that are reviewed are not generally speculative for the company. They help protect the company from unanticipated events: adverse foreign-exchange or interest-rate movements, and unexpected increases in input costs. The investor on the other side of the derivative transaction is the speculator. However, in no case are these derivatives free. Even if, for exam ple, the company is surprised with a good-news event like a favorable interest-rate move, the company (because it had to pay for the derivatives) receives less on a net basis than it would have without the hedge. Warren Buffetts stand is famous: he has attacked all derivatives, saying he and his company view them as time bombs, both for the parties that deal in them and the economic system. Foreign Exchange Risk Management Firms dealing with multiple currencies face risk in terms of unanticipated gain/loss on account of sudden/unanticipated changes in exchange rates, quantified in terms of exposures. Exposure is defined as a contracted, projected or contingent cash flow whose magnitude is not certain at the moment and depends on the value of the foreign exchange rates. The process of identifying risks faced by the firm and implementing the process of protection from these risks by financial or operational hedging is defined as foreign exchange risk management. My paper limi ts its scope to hedging only the foreign exchange risks faced by firms like TCS. 3.1. Kinds of Foreign Exchange Exposure Risk management techniques vary with the type of exposure (accounting or economic) and term of exposure. Accounting exposure, also called translation exposure, results from the need to restate foreign subsidiaries financial statements into the parents reporting currency and is the sensitivity of net income to the variation in the exchange rate between a foreign subsidiary and its parent. Economic exposure is the extent to which a firms market value, in any particular currency, is sensitive to unexpected changes in foreign currency. Currency fluctuations affect the value of the firms operating cash flows, income statement, and competitive position, hence market share and stock price. Currency fluctuations also affect a firms balance sheet by changing the value of the firms assets and liabilities, accounts payable, accounts receivables, inventory, loans in foreign currency, investments (CDs) in foreign banks; this type of economic exposure is called balance sheet exposure. Transactio n Exposure is a form of short term economic exposure due to fixed price contracting in an atmosphere of exchange-rate volatility. The most common definition of the measure of exchange-rate exposure is the sensitivity of the value of the firm, proxied by the firms stock return, to an unanticipated change in an exchange rate. This is calculated by using the partial derivative function where the dependant variable is the firms value and the independent variable is the exchange rate (Adler and Dumas, 1984). 3.2. Necessity of managing foreign exchange risk A key assumption in the concept of foreign exchange risk is that exchange rate changes are not predictable and that this is determined by how efficient the markets for foreign exchange are. Research in the area of efficiency of foreign exchange markets has thus far been able to establish only a weak form of the efficient market hypothesis conclusively which implies that successive changes in exchange rates cannot be predicted by analyzing the historical sequence of exchange rates.(Soenen,1979). However, when the efficient market theory is applied to the foreign exchange market under floating exchange rates there is some evidence to suggest that the present prices properly reflect all available information (Giddy and Dufey, 1992). This implies that exchange rates react to new information in an immediate and unbiased fashion, so that no one party can make a profit by this information and in any case, information on direction of the rates arrives randomly so exchange rates also fluctu ate randomly. It implies that foreign exchange risk management cannot be done away with by employing resources to predict exchange rate changes. 3.3. Foreign Exchange Risk Management Framework Once a firm recognizes its exposure, it then has to deploy resources in managing it. A heuristic for firms to manage this risk effectively is presented below which can be modified to suit firm-specific needs i.e. some or all the following tools could be used. Forecasts: After determining its exposure, the first step for a firm is to develop a forecast on the market trends and what the main direction/trend is going to be on the foreign exchange rates. The period for forecasts is typically 6 months. It is important to base the forecasts on valid assumptions. Along with identifying trends, a probability should be estimated for the forecast coming true as well as how much the change would be. Risk Estimation: Based on the forecast, a measure of the Value at Risk (the actual profit or loss for a move in rates according to the forecast) and the probability of this risk should be ascertained. The risk that a transaction would fail due to market-specific problems4 should be taken int o account. Finally, the Systems Risk that can arise due to inadequacies such as reporting gaps and implementation gaps in the firms exposure management system should be estimated. Benchmarking: Given the exposures and the risk estimates, the firm has to set its limits for handling foreign exchange exposure. The firm also has to decide whether to manage its exposures on a cost centre or profit centre basis. A cost centre approach is a defensive one and the main aim is ensure that cash flows of a firm are not adversely affected beyond a point. A profit centre approach on the other hand is a more aggressive approach where the firm decides to generate a net profit on its exposure over time. Hedging: Based on the limits a firm set for itself to manage exposure, the firms then decides an appropriate hedging strategy. There are various financial instruments available for the firm to choose from: futures, forwards, options and swaps and issue of foreign debt. Hedging strategies and in struments are explored in a section. Stop Loss: The firms risk management decisions are based on forecasts which are but estimates of reasonably unpredictable trends. It is imperative to have stop loss arrangements in order to rescue the firm if the forecasts turn out wrong. For this, there should be certain monitoring systems in place to detect critical levels in the foreign exchange rates for appropriate measure to be taken. Reporting and Review: Risk management policies are typically subjected to review based on periodic reporting. The reports mainly include profit/ loss status on open contracts after marking to market, the actual exchange/ interest rate achieved on each exposure, and profitability vis-Ã  -vis the benchmark and the expected changes in overall exposure due to forecasted exchange/ interest rate movements. The review analyses whether the benchmarks set are valid and effective in controlling the exposures, what the market trends are and finally whether the ove rall strategy is working or needs change. Figure 1: Framework for Risk Management Effect of Currency swings in Indian market Cross-currency volatility is gnawing at the profit margins of almost every tech company. The movement of non-dollar currencies has undone the gains from rupees downward movement against the US dollar. When Indian IT companies were first exposed to the rupee-dollar volatility in 2007 (that time the Indian currency was strengthening against the greenback), they had hedged themselves against the dollar. However, while the rupee movement reversed again, IT companies and their CFOs were caught off guard as other currencies showed unexpected volatility for which they had very little hedges in place. As per the research and news: Indias total trade now accounts for over 40% of its GDP, and this highlights the increasing openness of the Indian economy and its reliance on foreign trade. However, as companies revenues increasingly come from cross-border trad e, they also become more vulnerable to fluctuations and swings in currency rates. There are many such examples amongst the Indian business. A midsize iron ore manufacturer and exporter suffered losses to the tune of $9.5 million due to adverse currency movements and losses of derivative transactions, which caused its profitability to slump to 4.5% as compared with 15% in the previous year. In another example, a mid-size auto component manufacturer suffered exchange losses of $1.2 million in the fiscal year ended March 31, 2009. This was because the company did not have a foreign exchange (forex) strategy in place to proactively counter this risk. It has now started hedging on selective basis by way of plain vanilla forwards as a corrective step. Looking at the cases like these, companies are now stepping up their cross-currency hedges. Example of TCS As per the annual report of TCS in the year 2007-2008, we get the following details, which reflect the derivative instr uments used by TCS to hedge the forex risk. Derivative financial instruments The Company, in accordance with its risk management policies and procedures, enters into foreign currency forward contracts and currency option contracts to manage its exposure in foreign exchange rates. The counter party is generally a bank. These contracts are for a period between one day and eight years. The Company has following outstanding derivative instruments as on March 31, 2008: The following are outstanding Foreign Exchange Forward contracts, which have been designated as Cash Flow Hedges, as on: Â Â March 31,2008 Â Â Â March 31,2007 Â Foreign Currency No. of Contracts Notional amount of forward contracts (million) Fair Value (Rs. In crores) Â No. of Contract Notional amount of forward contracts (million) Fair Value (Rs. In crores) Â Gain/(Loss) Â Gain/(Loss) U.S.Dollar 14 290 25.21 Â Sterling Pound 3 15 3.91 Â 5 21 0.32 Euro 3 19 11.78 Â Â Â 0.35 The following are outstanding Currency Option contracts, which have been designated as Cash Flow Hedges, as on: Â Â March 31,2008 Â Â Â March 31,2007 Â Foreign Currency No. of Contracts Notional amount of forward contracts (million) Fair Value (Rs. In crores) Â No. of Contract Notional amount of forward contracts (million) Fair Value (Rs. In crores) Â Gain/(Loss) Â Gain/(Loss) U.S.Dollar 67 3871.50 (88.70) Â 27 830.00 32.71 Sterling Pound 7 55.65 (2.23) Â 5 47.50 (1.93) Euro 12 99.25 (38.75) Â 11 76.50 (0.60) Net loss on derivative instruments of Rs.21.83 crores recognized in Hedging Reserve as of March 31, 2008, is expected to be reclassified to the profit and loss account by March 31, 2009 The movement in Hedging Reserve during year ended March 2008, for derivatives designated as Cash Flow Hedges is as follows: Particulars Year ended March 31, 2008 Year ended March 31, 2007 Â (Rs. In crores) (Rs. In crores) Balance at the beginning of the year 73.71 4.42 Gains / (losses) transferred to income statement on occurrence of forecasted hedge transaction 64.91 4.42 Changes in the fair value of effective portion of outstanding cash flow derivatives 174.78 29.64 Net derivative gain/(losses) related to a discontinued cash flow hedge 150.83 44.07 Balance at the end of the year 15.15 73.71 In addition to the above cash flow hedges, the Company has outstanding foreign exchange forward contracts and currency option contracts aggregating Rs. 2167.95 crores (previous year : Rs.2062.61 crores), whose fair value showed a loss of Rs.4.46 crores as on March 31, 2008 (previous year : gain of Rs 6.76 crores), to hedge the future cash flows. Although these contracts are effective as hedges from an economic perspective, they do not qualify for hedge accounting and accordingly these are accounted as derivatives instruments at fair value with changes in fair value recorded in the profit and loss account. Exchange gain of Rs.283.96 crores (previous year gain of Rs.45.13 crores) on foreign exchange forward contracts and currency option contracts have been recognized in the year ended March 31, 2008.