DC Edit | Markets close in the green
![DC Edit | Markets close in the green DC Edit | Markets close in the green](https://www.deccanchronicle.com/h-upload/2024/03/29/1081653-la-2443213.webp)
As the last trading day in the current financial year 2023-24 ended, the Indian stock markets registered one of the record growths in their lifetime, giving bumper returns to investors. The growth was across the board in all indices. The Nifty 50 index registered a growth of 30 per cent, while the BSE Sensex shot up 27 per cent. The small-cap index posted a nearly 62 per cent jump, while the mid-cap index went up the most by around 65 per cent in FY24.
Several factors contributed to such a stupendous growth in stock markets and, as a result, investor wealth. One of the key drivers is the robust growth in the country’s gross domestic product (GDP), which beat forecasts to remain the world’s fastest growing economy. The country’s economic growth prospects, too, continued to inspire investor confidence. Better economic prospects will boost business confidence and also investor confidence, which will, as a result, create wealth for investors.
In a country like India which is still not a fully liberal economy, the government and its policies play a key role. Prime Minister Narendra Modi's government had taken reform measures such as the Goods and Services Tax, and digitalisation of the economy, among others, which boosted the share of the formal sector in the economy, which once again resulted in better growth in revenue and profits and, thereby, share price and investor wealth.
While gold is typically seen as a hedge against inflation, a stable stock market allowed people to channel their savings into stock markets through systematic investment products, which made stocks less vulnerable to foreign investors and further boosted investor confidence in Indian stocks, attracting money from major global institutional funds. The phenomenal growth in the Indian stock markets, therefore, is an ode to the Narendra Modi government’s prudent economic policies anchored in ground reality.