Special Characters problem in Index entry

Hi Experts,

I'm using InDesign CS4 with MAC OS 10.6.8.

We are doing other language books like Italian, Swedish, Germany, Dutch, French, etc., We are converting word manuscripts to styled text file and that has been flowed in the InDesign Template file. While flowing the text file in the Template, special characters (ä, å, ë, ï, ö, ü, œ) are not converted properly in the index palette.

I have attached screenshots for your reference. Please help me if you have the solution for these.

Screenshot from Text file

Screenshot from Template file