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India’s stock market is now the world's fifth largest and the credit goes to the brisk upsurge in retail investor base and reviving foreign inflows. With this, for the first time, the Indian stock market is getting very close to the historically remarkable milestone of a $4 trillion value while the Chinese stock market continues to struggle.

With nearly a 14% increase in 2023, the Nifty gauge is on track for an unprecedented eighth consecutive year of gains. As per the data shared by Bloomberg, since March 2020, the market capitalization of the securities listed on the nation’s exchange witnessed a threefold rise, reaching an impressive margin of $3.93 trillion, as of Friday's end.

With the 3 state-swiping election win of Prime Minister Narendra Modi-led-BJP government, the Sensex and Nifty soared up to an extraordinarily high water mark during the market opening on Monday, December 4, 2023. Till yesterday afternoon, the benchmark exhibited a 1.7% increase. Being the world's fastest-growing major economy, India’s stock market is positioning itself as an attractive alternative to Beijing for both global investors and companies.

The statistics show, that this year, overseas funds have poured in over $14 billion into local shares, complemented by a sustained boost from the surge in retail investing that gained momentum during the pandemic. While the world economies are on fire, India has turned out to be an outstanding performer, recording a substantial 7.6% growth in gross domestic product (GDP) for the 3 months ending September compared to the previous year.

The trend extends to Indian stocks, as evidenced by an MSCI Inc. gauge of local shares, which is set to outperform a global emerging-markets measure by over 10 percentage points for the third consecutive year. Particularly noteworthy is the stark outperformance compared to Chinese peers, with the Indian gauge poised to surpass the MSCI China Index by more than 20 percentage points for the third consecutive year.

The current reputation of India at the international level and the continuous efforts of Prime Minister Modi are one of the crucial reasons behind global firms being attracted to invest in India. However, some investors express apprehension about the stock market, highlighting concerns about overvaluation and the increasing crowd in the trading market, which raises the likelihood of a significant pullback.