In the backdrop of growing geopolitical tensions, economic uncertainty, and rapid technological transformation, India’s financial markets are navigating uncharted territory with remarkable resilience. At the heart of this ecosystem stands the National Stock Exchange (NSE), India, a pillar of trust and transparency in India’s economic story. In this exclusive conversation with Organiser Editor Prafulla Ketkar, Ashish Chauhan, MD & CEO, NSE, shares deep insights into the impact of the Pahalgam terror attack, the future of global trade and tariff wars, India’s position in an evolving multipolar world, and the transformative role of technology, especially AI in financial markets. Excerpts:
In the aftermath of the Pahalgam attack and the subsequent war-related developments, how do you assess the current situation, and what impact do you foresee on the financial markets?
In a way, the incident has occurred, and it is undeniably a tragic event for society as a whole. At the same time, the lessons to be drawn from it vary across different groups, and each must take responsibility and act accordingly within their domain. Simultaneously, civil society at large must now begin the process of rebuilding the lives of those affected, particularly the families who have suffered. Additionally, the international repercussions of the incident must not be overlooked, as that dimension presents its own set of challenges.
The NSE too has played a role, albeit a modest one. We have announced a contribution of Rs 1 crore, which translates to approximately Rs 4 lakh per family. This is simply an attempt to ease some of the immediate burdens, especially considering that many of the deceased were the primary earning male members of their families. From our perspective, what NSE has done is something any conscientious and responsible Indian organisation ought to do.
More importantly, I believe society must now focus on rebuilding itself and, crucially, on taking proactive measures to ensure such incidents are minimised in the future. While the probability of such tragedies can never be reduced to zero, we must strive to bring it down as much as possible. When we look back, we find that the context and responses in the past were quite different. Today, the scenario has evolved significantly, and I would give considerable credit to Prime Minister Narendra Modi and his team. Over the past 10 to 11 years, they have succeeded in creating a strong international presence for India, and the country’s economic growth under his leadership has been remarkable. As a result, India’s voice is now being heard on the global stage more clearly than ever before. That, in my view, is the key difference today.
“China is entering Japan’s 1980s stagnation mode. India is in a sweet spot”
But this is not an isolated incident. When we look at the broader landscape of international geopolitics and geoeconomics, there has been ongoing discussion around the global tariff war, particularly since President Trump assumed office in the United States. Do you believe we are moving towards an increasingly protectionist global economy? And in this evolving scenario, how should investors approach their strategies and outlook?
I look at history to understand today’s tariff wars. After World War II, the Bretton Woods system led to institutions like the World Bank and the IMF. America became the global leader not during but after the war because it had prepared itself since the 1920s and 1930s. With its diversity, size, and innovation, including the atom bomb, it took charge. The US replaced Britain’s pound with the dollar (still gold-backed) and helped rebuild Germany and Japan post-war, giving them favourable access to Western markets. Since both outsourced their security to the US, they posed no threat.
But when Japan rose economically in the 1980s, the West imposed tariffs to curb its exports. Even today, Japan’s Nikkei hasn’t touched its 1986 peak. This shows how emerging powers face resistance.
Similarly, the US supported China from the 1970s to isolate the USSR, Kissinger’s 1971 visit laid the path. China was then inward-looking, but wanted to learn Western science after historical humiliations like the Opium War. Over 45 years, global companies invested heavily, and China now accounts for 35–40 per cent of global industrial production. India’s industrial growth couldn’t match it because the West favoured China’s rise. But now, that same liberal global order is collapsing. America’s rich post-WWII gave generously, created the WTO, the WHO, UN, and tied itself to global rules. But after 40 years, it feels poorer, overburdened with $36 trillion in debt and $100 trillion in social liabilities, largely due to promises made when jobs were offshored. That anger gave rise to leaders like Trump, and even if it wasn’t him, someone similar would’ve emerged.
“India’s future wealth won’t come from factories but from code, data, and digital experience”
I believe geopolitics eats economics for breakfast. Countries act not just economically, but strategically. China’s rise is now seen as a military threat too, with disputes from India to the Philippines. At the same time, its economy is weakening due to demographic decline, over-leveraged banks (350–400 per cent of GDP), and unproductive infrastructure. In contrast, India’s banking system accounts for only 60 per cent of its GDP. Meanwhile, Europe is leaning more towards the Left; the US remains right-leaning, so differences may emerge not economically, but ideologically. Still, they are culturally aligned. We are entering a multipolar world.
India, now the fourth largest economy, is finally at the table. We weren’t there in 1945, 1972, or even 1991. Today, thanks to technology, demographics, and growing production capacity, we are. For 1,000 years, we were out of the tech race; now, for the first time, we are in it. Even if we didn’t create foundational models like Unix or Python, we are the best users and run global systems from India. Our young population adapts fast. That’s our edge. This is also the best administration I’ve seen aware of constraints, but also willing to act. India’s global image, non-aggressive, tech-savvy, and trustworthy, has been amplified by our diaspora, who act as ideal ambassadors. They’ve helped build a new narrative of India, rooted in credibility and performance.
How should investors look at this scenario? Amid so much volatility and noise, what should they focus on?
Investment is essentially about predicting the future. People invest because they expect returns. Some do it routinely, others rely on experts, but in the end, it’s all about who correctly anticipates growth, and others often follow success. From that lens, the question is: which country looks poised for higher growth? India’s per capita income is around $3,000, compared to China’s $18,000 and the US’s $65,000. That gap creates a labour arbitrage opportunity. With telecom and IT connectivity, services can now be delivered from India at a fraction of the cost, without physically relocating.
I believe technology comes in waves—industrial, information, and now AI. Each wave is faster and creates more wealth. The Industrial Revolution created more wealth than the previous 10,000 years. My view is that the next 50 years will create even more wealth than the last 10,000 years combined, and India will be central to that due to its technological capabilities, young population, and low base.
Earlier, wealth was physical – land, cows, and industries. Today, it is increasingly virtual – gaming, software, digital services, even biotech. India, with its abstract thinking and tech skills, is well-suited to this virtual economy.
We have 17 per cent of the world’s population, 20 per cent of the world’s youth and this group will likely generate 25–30 per cent of the world’s new wealth. Meanwhile, countries like the US and China, though wealthier, are declining in demographic and economic terms. China has serious debt and demographic issues and is entering a phase similar to Japan’s stagnation in the 1980s.
So India is in a sweet spot. But investors must learn to focus on signals, not noise. TV and social media bombard us with noise. But markets move on deeper trends. When events like Pakistan’s provocations occur, markets price them in quickly. As someone once said, there are “known knowns, known unknowns, and unknown unknowns.” COVID-19, for instance, moved from unknown to known, and markets adjusted.
Today, despite geopolitical tensions, Indian markets are up. Foreign investors, who exited earlier, have now started returning. The smart investor is the one who can see through the noise and act on the real signal.
Let’s turn to the NSE – an institution you’ve been associated with for over three decades. Having witnessed shifts in global dynamics, technological advancements, and changing investor behaviour, how would you describe the evolution of the NSE and India’s stock markets over the years?”
I joined NSE in 1992 as a 24-year-old engineer-MBA. My bank was sold to help set it up, and being the only engineer and the youngest, I was handed technology tasks, even the smallest chores. As the only Gujarati, I also had to handle the stock market side. I worked on building satellite telecom, screen-based trading, and implementing the tech platform. When NSE was launched in 1994, India had only 10–15 lakh investors, mostly in metros, and the total market cap was about Rs 4 lakh crore. Today, that has grown 100 times to Rs 400 lakh crore, and we have over 11 crore investors, covering 8.5 crore households, or 20 per cent of all Indian homes.
What changed? We built trust using technology. NSE was India’s first public digital infrastructure, launched on a full scale in 1995 with a real-time, under-2-second trade execution unheard of then. In Coimbatore, I placed a trade live, and the 75-year-old investor was stunned that it executed in seconds. That transparency and fairness were transformative.
In 1994, computers were rare, phones took five years to instal, and people resisted tech, fearing job loss. Yet, NSE delivered reliable nationwide trading, setting the foundation for India’s IT revolution. We became the first fintech, processing 2,000 crore orders a day today—more than UPI’s monthly load. Our system now runs at 100 microseconds and is moving towards nanoseconds.
Earlier, getting company info took months. Today, thanks to quarterly disclosures and strict corporate governance, India is among the global leaders in transparency.
Markets manufacture trust between savers and entrepreneurs. Poor people aren’t expected to invest, let alone in strangers far away. But in India, that trust has grown. We have investors in 19,400 pin codes—only 28 remain, mostly at airports. That trust, built over 78 years, is our true wealth. It has enabled ordinary Indians to dream big.
Even economic research suggests that traditional societies, relatively poorer societies, have a tendency to save rather than invest. People put money in FDs, provident funds, and gold. How did NSE overcome that inertia and shift people to the capital markets? What specific initiatives were taken?
Investment is about demonstrated returns. When someone benefits from long-term stock investments, others in their circle follow. That is how trust builds—gradually, through performance. Over time, equity markets have consistently delivered better returns than FDs, gold, or real estate, and with much greater liquidity.
During COVID-19 when the PM Modi announced a nationwide lockdown, NSE declared that it would remain open. Regulators had already classified markets as essential services. Why? Because in a crisis, liquidity matters. Unlike real estate or even gold, stocks offer quick access to funds. If markets were shut, people would panic and flee to other assets. Over 30 years, Nifty has returned 11.9 per cent CAGR, compared to gold’s 7.7 per cent. Even in dollar terms, Nifty outperformed the S&P 500. I often say the US needed Warren Buffett; India just needed Nifty. It’s a public benchmark, accessible to all, and acts like a thermometer, measuring economic health and hope.
What started as a technical task evolved into something transformative. NSE helped build trust through technology. From just 10–15 lakh investors in 1994, we now have 11 crore, making us the world’s 15th largest investor base, and 4th in market capitalisation, after the US, China, and Japan. And unlike China, our Government doesn’t prop up falling markets. This vibrant market ecosystem was built on transparency and tech. The same digital infrastructure later powered India’s Jan Dhan, Aadhaar, GST, and UPI revolutions.
Ease of trading is the buzzword these days. First, let us know our readers about the significance of ease of access and trading and how NSE is promoting the same?
Ease of trading plays a pivotal role in ensuring seamless market participation, promoting investor confidence, and driving inclusive capital market development. At NSE, this ease is enabled by a combination of technology, strong operational processes, and extensive investor outreach. NSE has consistently invested in state-of-the-art technology infrastructure to ensure smooth access and reliable connectivity, making trading processes simpler and more efficient. Regular capacity enhancements, strong cybersecurity protocols, and real-time system monitoring ensure the platform remains robust.
“Over the last 11 years under PM Modi’s leadership, Indian market has seen massive growth. This shift was enabled by digitisation, e-KYC, investor education, regulatory reforms, and a broader move from physical to financial assets”
Beyond infrastructure, NSE places strong emphasis on investor empowerment. In FY24-25, NSE conducted 14,679 Investor Awareness Programmes (IAPs)—a 149 per cent increase over the previous year—reaching nearly 8 lakh participants across all 36 States and UTs in 14 languages. NSE also held 112 IAPs at 12 companies, benefiting over 8,000 employees of top listed companies. To expand outreach, NSE partnered with Zomato, Swiggy, and Divyaj Foundation to promote financial literacy among delivery partners and BMC workers and has already conducted 68 IAPs attended by 5,500+ participants. In Maharashtra, NSE has tailored initiatives for empowering the women workforce with financial literacy, while in States like Uttarakhand, Chhattisgarh, Assam, Meghalaya, and Goa, it additionally supports youth skilling in the BFSI sector. NSE also leverages digital and traditional media extensively, with over 724 social media posts generating 14.5 crore impressions, along with 45,300+ slots on TV and 5,500+ radio spots promoting investor awareness. A mix of strong technological safeguards and frequent organisation of IAPs, reinforces NSE’s commitment to reliability, investor confidence and the seamless functioning of the markets.
When NSE and Nifty were launched in the early 1990s, India was transitioning from a socialist framework into a liberalised economy. Since then, we’ve witnessed waves of transformation from the telecom and IT booms to digital infrastructure. Now, as we enter the era of AI, data, and immersive technologies, how do you envision the impact of Artificial Intelligence on the broader economy and financial markets?
When electricity arrived a century ago, no one imagined how integral it would become to daily life. The same happened with tools like the JCB expected to reduce jobs, but instead led to more digging. Every major technology shift changes skill demands, not necessarily job volumes.
Earlier, programmers had to learn syntax; now AI can handle that, meaning we will need far more programming, not less, just with different skills. Stock markets saw a similar shift—from 10,000 trades a day in the floor-based BSE to 30 crore trades a day today. Some old roles vanished, but many adapted. The same will happen with AI.
India should aggressively adopt and use global AI models and build its own too. Even today, much of Google’s or OpenAI’s development happens in India, though the IP sits elsewhere. Indians are well-positioned to lead the AI revolution. The future is about creating experiential, virtual value through AI, robotics, drones, and more. While physical tools matter, their intelligence will be virtual, and Indians are best suited to adapt.
The Foreign Institutional Investors (FIIs) have always been a matter of concern for Indian markets. While Domestic Institutional Investors (DIIs) are coming forward, the FIIs have been fluctuating in their investments. How do you view this shift?
FIIs have historically played a key role in Indian markets, with ownership peaking at 22.18 per cent in 2019. However, their share has declined to a 13-year low of 17.4 per cent by December 2024, despite portfolio value doubling to Rs 75.8 lakh crore. Their investment decisions are influenced by global factors, and though volatile, they remain significant with exposure to over 1,800 listed stocks.
In contrast, Domestic Institutional Investors (DIIs)—led by Mutual Funds and insurance firms—have grown steadily. Their ownership rose from 10.3 per cent in 2014 to 17.5 per cent in 2024, with record inflows of Rs 6.1 lakh crore in FY25. This growth reflects rising retail participation and improved financial literacy.
Direct retail investors are now a major force, contributing Rs 1.25 lakh crore in FY25 alone. Their direct ownership reached 9.8 per cent of NSE market cap by December 2024—the highest since 2007—while combined direct and indirect holdings via mutual funds rose to a record 18.2 per cent, overtaking FPI ownership for the first time since 2006.
Together, FIIs, DIIs, and retail investors form a balanced foundation for India’s capital market resilience and long-term growth.
Global indices and rating agencies often rank India poorly, be it on press freedom, hunger, or credit ratings despite visible progress. Should we accept these assessments, challenge their bias, or develop our benchmarks, especially given their long-term impact on investment sentiment?
Indexes are meant to measure, but when they become ideologically biased, they lose credibility. Many global indices like those on press freedom or health have become less relevant. People eventually question how a country like India, full of smart, outspoken people, can rank so poorly. These rankings turn into noise or entertainment, not serious assessments. So we shouldn’t take them to heart.
Credit rating agencies carry slightly more weight, but they too reflect a certain Western mindset. During the global financial crisis, even struggling European economies didn’t collapse due to EU backing—this is called credit enhancement. Still, India often finds itself rated poorly, despite vast improvements over decades.
In reality, India has grown with minimal foreign borrowing. Today, it doesn’t need the kind of capital inflows such ratings are meant to influence. Their judgements A, A+, etc were exposed during the 2008 crisis as flawed. Many survived lawsuits only because of system loopholes. These ratings often act as political tools.
What matters now is financial discipline, which India has demonstrated over the last 10 years. We have reached a stage where external validation is less relevant.
How has investor behaviour in the stock market evolved from 2014 to 2024, and what factors have contributed to the increased ease and participation in investing?
Over the last 11 years under , Indian markets have seen massive growth. Nifty rose by 260 per cent and Nifty 500 by 315 per cent, while NSE’s market cap surged nearly 6x—from Rs. 73.5 lakh crore in May 2014 to Rs 417 lakh crore in 2025. Investor numbers jumped from 1.65 crore to 11.3 crore. A major milestone was the launch of GIFT NIFTY trading in July 2023, boosting market vibrancy in line with the ‘Onshoring the Offshore’ vision.
Individual investor participation has significantly deepened—becoming net buyers for six straight years, with FY25 inflows over Rs 1.25 lakh crore. Their equity ownership rose from 10.9 per cent in 2014 to 18.2 per cent in 2024, surpassing FPIs. Holdings grew 10x to Rs 79.6 lakh crore. Investor penetration now covers 99.9 per cent of Indian pin codes. SIPs have become mainstream, with monthly inflows rising from Rs 3,660 crore in FY17 to Rs 24,130 crore in FY25, accounting for one-fifth of mutual fund AUM.
This shift was enabled by digitisation, e-KYC, investor education, regulatory reforms, and a broader move from physical to financial assets. As a result, stock market exposure now reaches nearly 1 in 5 Indian households, up from 1 in 14 five years ago.
With the vision of Viksit Bharat 2047 and talks of a new global order and de-dollarisation, how do you define the core goals of Atmanirbhar Bharat? What challenges do you foresee in achieving them?
Per capita income is just an average—like saying a lake’s depth is 4 feet. You can still drown. So real progress means improving the life of the last person, the Antyodaya. Over the last 10–11 years, we’ve built a basic social security net—pension schemes, Ayushman Bharat, free gas, education, housing, and most importantly, free food.
I remember worrying in my youth about how we’d feed our people places like Kalahandi saw starvation deaths. So during COVID-19, when we could feed 80 crore people daily, I felt we had truly become rich as a nation. That is a huge achievement.
As for the rupee vs dollar debate many ask, “When will 1 Rupee be equal to 1 Dollar?” I say, we could do it tomorrow, but we’d lose competitiveness. Like Japan (150 yen/dollar), we should not chase symbolic pride. What matters is jobs, rising incomes, and improving lives at all levels—mean, median, and lowest.
India has grown through democracy, non-violence, negotiation, and technology. If we stay this course, I have no doubt we’ll be a prosperous country by 2047.
Today, industrialisation is coming at a scale unimaginable even five years ago. Apple, for instance, plans to source all iPhones for the US from India. Many global players are shifting here.
As the PM says sabka saath, sabka vikaas, sabka vishwas, sabka prayas. For me, sabka prayas—everyone’s effort—is most important. Leaders can guide, but nation-building is everyone’s job.
Coming from a humble background in Gujarat to leading the NSE, what message would you give young Indians on taking charge of their own future instead of relying solely on the Government?
I consider the last 78 years of India’s Independence as a golden period for the backward classes. Credit goes to our Constitution makers and institutions that upheld social justice. It’s easy to feel bad about coming from a humble or disadvantaged background but no one owes you anything. You have to work harder, sometimes five times harder but technology, education, and knowledge now give everyone a real shot.
I’m an example of this India today that gives real opportunities. Yes, discrimination may still exist in certain pockets, but today’s India is far more inclusive and tomorrow’s India will be even better.
Given the volatility of the stock market, what advice would the NSE Chief offer to investors?
While the market will inevitably experience short-term fluctuations, long-term wealth creation rewards patience and consistency. India’s structural strengths—including a large and growing domestic market, leveraging demographic dividend with young population, growing middle-class, improving infrastructure, strong political leadership, a vibrant digital economy, and a stable macroeconomic framework—provide a strong foundation for sustained growth. These long-term fundamentals, along with rising household participation and a robust regulatory framework, have supported increasing confidence in Indian equities. What should give investors confidence is the robust regulatory framework that underpins India’s capital markets. NSE is the symbol of trust and transparency, enabling investors across geographies to confidently participate in Bharat’s growth.
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