Strong fundamentals to shield India from global shocks, says NSE MD & CEO Ashish Chauhan

At a time when global markets are facing uncertainty due to geopolitical tensions and rising crude oil prices, Ashish Chauhan, MD & CEO of the National Stock Exchange (NSE), believes India remains structurally strong and well-positioned to handle near-term shocks.

Speaking at the Business Today MindRush & India’s Best CEOs Awards on the theme “Capital Markets at the Crossroads,” Chauhan said that despite current market pressures, India’s long-term fundamentals remain intact. “India is the fastest-growing major economy and one of the largest savers in the world,” he noted, adding that nearly 30% of the country’s $4.2 trillion economy is saved and increasingly moving into financial markets instead of traditional assets such as gold and real estate. 

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He pointed out that India’s limited capital account convertibility is a key advantage, as it ensures that domestic savings are largely invested within the country. This has helped deepen the markets, with the NSE now serving over 12.7 crore investors, reflecting strong retail participation.

Chauhan also highlighted India’s demographic and technological strengths. With a young population and rapid adoption of digital systems—from UPI to mobile-based stock trading—India has moved ahead of many developed economies. “Technology adoption is a major driver of long-term wealth creation, and India has done well on this front,” he said.

On rising crude oil prices due to tensions in West Asia, Chauhan acknowledged the risks but remained confident. He said India’s oil import bill could increase by about $50 billion, but with foreign exchange reserves of around $700 billion, the country remains in a comfortable position. He added that low inflation, a controlled fiscal deficit, and low leverage in both the banking system and the government provide additional stability.

Valuations in the Indian market have eased in recent weeks, making equities relatively more attractive. Price-to-earnings (P/E) ratios for benchmark indices like the Nifty have corrected to the low-20s range from around 24 earlier, indicating a meaningful cooling-off in valuations.

Chauhan explained that when valuations rise too high, markets tend to rebalance—either earnings catch up with prices or prices adjust downward. “We are now moving towards a more reasonable zone,” he said.

On foreign investor flows, Chauhan noted that while foreign portfolio investors (FPIs) have pulled money out of global markets, India has seen relatively smaller outflows compared to other countries in recent months. He added that FPI flows were still positive in February but turned negative in March due to evolving global conditions, suggesting that the recent market correction is largely driven by external factors rather than domestic weaknesses.

For retail investors—especially those experiencing their first market downturn—he advised staying focused on the long term. He noted that most investors have limited exposure to equities and are unlikely to panic. He also highlighted that India’s market capitalisation has grown nearly sevenfold since 2014, reflecting strong long-term wealth creation.

Chauhan added that rising oil prices could push up global inflation and limit central banks’ ability to cut interest rates, potentially leading to continued market volatility. However, India’s strong food production and government support systems help cushion the domestic impact of inflation.

On the NSE’s much-awaited IPO, Chauhan said it remains on track, with 2026 looking feasible, subject to regulatory approvals.

Despite short-term volatility, Chauhan’s message remains clear: India’s fundamentals are strong, and patient investors are likely to benefit over the long term.