India's Financial Revolution: How Rao, Singh, and the 1992 Crisis Built a Modern Capital Market
From Clubby Chaos to Digital Dominance – The State-Led Overhaul That Transformed Dalal Street India's 1991 economic liberalization under Prime Minister P.V. Narasimha Rao and Finance Minister Manmohan Singh dismantled the License Raj and opened the economy. Yet, a quieter but equally transformative revolution unfolded in the capital markets. The archaic, broker-dominated Bombay Stock Exchange (BSE) was riddled with inefficiencies, opacity, and corruption. The 1992 Harshad Mehta scam exposed systemic flaws, providing political momentum for bold reforms. Rather than incremental fixes, the government pursued institutional insurgency: empowering the Securities and Exchange Board of India ( SEBI ), launching the technology-driven National Stock Exchange ( NSE ), and enforcing share dematerialization. This created a transparent, nationwide, digital market that drew foreign capital, empowered retail investors, and set a global example for emerging economies. The Broken System and the...