THE ECONOMIC-EQUITY NEXUS: INDIA'S STORY

Abstract

A well-organized and regulated financial system is fundamental to a nation's economic growth. The Indian financial system is segmented based on market characteristics, financial instruments, institutions, and available services. Financial markets are crucial for a country's economic advancement as they facilitate capital formation and the exchange of short-term and long-term financial assets. In India, these markets are broadly categorized into money markets, dealing with short-term instruments like commercial and treasury bills, and capital markets, which handle long-term assets such as bonds and shares. The primary function of India's capital markets is to enable capital formation, allowing businesses, individuals, and the government to accumulate funds for various durations.