India, which is reckoned as a bright spot in the world economy landscape, has hit a market capitalisation of $4 trillion.
Market cap is simply the market value of a company listed on a stock exchange.
In this context, the market cap of all companies listed on the Bombay Stock Exchange (BSE), which is among the oldest bourses in Asia, has touched $4 trillion. This puts India among the top five countries in the world to achieve the feat.
India is only behind the US, China, Japan and Hong Kong with a market cap of more than $4 trillion each.
USA with a market cap of about 46 trillion dollars leads the global chart of market cap. China is placed second with a market cap of over 10 trillion dollars, while Japan occupies the 3rd place with about $5.5 trillion.
Hong Kong comes fourth with a market cap of 4.7 trillion dollars, and India has captured the 5th place in the marquee list.
The market cap is a different concept than the Gross Domestic Product (GDP) of an economy. GDP of a country is the total value of goods and services produced during a financial year.
Interestingly, India is still not a 4 trillion dollar economy on the GDP parameter although it is soon catching up.
Meanwhile, the $4 trillion achievement by India Inc reflects the depth of the Indian capital markets and the faith reposed in its domestic economy by retail and institutional investors as well as foreign funds.
In the last 20 years, the market cap of BSE has risen by nearly 40 times, giving heft to the Indian stock, capital and financial markets.
Meanwhile, the recent surge in the BSE market cap was aided helped by a clutch of big companies including Adani Group, which added $12 billion dollars alone to its share value.
Meanwhile, global broking major CLSA has predicted India would become the world’s top economy by 2052 with a nominal GDP of $45 trillion. India would be a $29 trillion economy by 2047, when the country completes 100 years of its independence from colonial rule.
Currently, the GDP of India is pegged at $3.7 trillion dollars, with India placed 4th in the GDP pecking order behind USA, China and Japan.
CLSA estimated India would dethrone Japan as the world’s 3rd largest economy by 2027.