A Study of Impingement of Stock Market on Indian Economy

Abstract

In terms of purchasing power parity, the Indian economy is one of the biggest and is expected to keep expanding in the near future. Nevertheless, the nation's thriving economy is expected to go through a number of ups and downs, including changes in the stock market, which can have a big influence on its development. For instance, the Indian stock market experienced a large, methodical reorganisation from 1994 to 2005. Highlights of the Indian economy during this time period included an average GDP growth of 6.1%. Present research study is based on secondary data, collected from Annual Reports of Reserve Bank of India and official websites of NSE & BSE. The sample is ranged from year 2001-2022. For the purpose of the study, a linear regression model is incorporated to know the relationship between the stock indices, i.e., Nifty and Sensex and Gross Domestic Product (GDP). The regression model asserts that the movement in the stock market indices impacts the GDP positively in long run.