STT Hike: Curbing Excess Or Hurting Markets? Raamdeo Agrawal Speaks

Is the concern around the STT hike overstated - or are policymakers underestimating market realities? In this conversation, veteran investor Raamdeo Agrawal explains why India has entered a fundamentally new era where financial markets have outgrown the real economy. With market capitalisation now at nearly 130% of GDP, policy decisions can no longer treat markets as peripheral. While Agrawal agrees with the intent to curb excessive speculation, he argues the execution could have been sharper, with deeper consultation with exchanges, brokers and market participants. Drawing global parallels with the US, he stresses that strong financial markets now underpin economic and geopolitical power. The message is clear: regulation must evolve with market scale, or risk unintended consequences for liquidity and investor confidence.