India’s capital markets are witnessing a structural transformation in which domestic household savings are increasingly replacing Foreign Portfolio Investment (FPI) as the primary source of market liquidity. This shift has strengthened market stability and reduced vulnerability to global capital volatility, but it has also brought challenges related to investor protection, valuation risks, and inclusive participation, especially in the context of Viksit Bharat 2047.

The growing dominance of domestic capital has improved the resilience of Indian financial markets and enhanced policy autonomy. However, unequal participation, weak financial literacy, and governance concerns must be addressed to ensure inclusive and sustainable capital market growth.

Role of Domestic Savings in Shaping Indian Capital Markets

Shift in Market Ownership and Control

• FPI ownership in Indian equities has declined to a 15-month low of 16.9%, and to 24.1% in the NIFTY 50.

• Domestic mutual funds are recording consistent record inflows, supported by rising Systematic Investment Plan (SIP) contributions.

• Retail investors now own nearly 19% of the equity market, the highest share in over two decades.

• This reflects a shift in market power from volatile global capital to stable domestic savers, making markets less exposed to external shocks.

Expansion of Primary Markets and Capital Formation

• In FY 2025, domestic confidence is reflected in a strong primary market, with 71 mainboard IPOs raising over ₹1 lakh crore.

• Corporate investment announcements increased by 39% year-on-year, with nearly 70% led by the private sector.

• This indicates improved domestic risk appetite, deeper capital mobilisation, and confidence in India’s growth prospects.

Improved Market Stability

• Domestic savings act as a long-term and stable source of capital, reducing volatility caused by sudden FPI inflows or outflows.

• During periods of global uncertainty, such as the October 2025 market rally, domestic flows provided a stabilising buffer.

• This enhances overall market resilience and investor confidence.

Greater Monetary Policy Autonomy for the RBI

• Reduced reliance on FPI flows has provided the Reserve Bank of India (RBI) with greater policy flexibility.

• The RBI can better:

  • Manage the growth–inflation trade-off

  • Expand bank credit

  • Reduce frequent interventions to defend the rupee

• However, this flexibility depends on continued household confidence and may weaken during sharp market corrections.

Overview of Financial Markets in India

Meaning of Financial Markets

Financial markets are platforms for trading stocks, bonds, currencies, and derivatives. They facilitate capital formation, investment, and economic growth.

Major Components

• Money Market: Deals in short-term instruments with maturity of less than one year.

• Capital Market: Facilitates long-term investment and includes:

  • Primary Market (issue of new securities)

  • Secondary Market (trading of existing securities)

• Foreign Exchange Market: Enables currency exchange for international trade and investment.

• Derivatives Market: Trades instruments like futures and options derived from underlying assets.

Key Challenges in Domestic-led Capital Markets

Investor Readiness and Financial Literacy Deficit

• A large number of new retail investors lack awareness of market risks, valuations, and cycles.

• Market corrections can lead to losses, weakening long-term trust in equity markets.

Valuation Excesses

• Several IPOs and new-age companies are priced well above their fundamentals.

• A reversal in sentiment may result in sharp corrections, disproportionately affecting small investors.

Low Investor Returns

• Most active mutual funds fail to outperform benchmarks after fees and risk adjustment.

• Passive investment options like index funds and ETFs remain under-utilised, limiting investor returns.

Unequal Participation in Capital Markets

• Equity ownership is concentrated among urban and higher-income households.

• This leads to unequal distribution of wealth, limiting the role of capital markets in inclusive growth.

Corporate Governance Concerns

• Declining promoter shareholding raises concerns about long-term commitment.

• Stronger governance and transparency are required to protect domestic retail investors.

Measures Required to Strengthen Capital Markets

Strengthening Investor Protection

• Enhance SEBI’s regulatory framework by moving beyond disclosure-based norms.

• Promote suitability-based selling, simplified products, and stricter oversight of intermediaries.

Promoting Low-cost Passive Investments

• Encourage index funds and ETFs through lower costs and awareness campaigns such as “Mutual Fund Sahi Hai”.

• This can improve risk-adjusted returns for small investors.

Enhancing Financial Literacy and Trust

• Expand financial education under the National Strategy for Financial Education (NSFE).

• Focus on women, rural investors, and first-time participants.

Deepening Corporate Governance Reforms

• Strengthen enforcement of the Companies Act, 2013 and SEBI LODR norms.

• Ensure transparency, accountability, and effective role of independent directors.

Adopting Data-driven Inclusion Policies

• Use data from RBI, SEBI, and NPCI.

• Align policies with JAM trinity and Digital India to identify access gaps and promote inclusive participation.

Conclusion

The growing dominance of domestic household savings has improved the stability and resilience of India’s capital markets. However, without financial inclusion, investor literacy, strong governance, and effective regulation, this stability may not be sustainable. Addressing these challenges is essential to ensure equitable growth and long-term trust in India’s capital markets on the path to Viksit Bharat 2047.

India is aiming for complete indigenisation of its high-performance computing (HPC) systems by 2030. Indigenous content in supercomputing systems has already reached around 50% and is expected to exceed 70% by the end of the decade. Under the National Supercomputing Mission (NSM), India plans to deploy 90 petaflops (PF) of computing capacity by March 2026, significantly strengthening national technological capability and strategic autonomy.The National Supercomputing Mission (NSM) seeks to build indigenous HPC infrastructure, reduce dependence on foreign technologies, and support cutting-edge research. Key milestones include the Rudra server, Trinetra high-speed network, and the AIRAWAT AI supercomputer. The upcoming NSM 2.0 focuses on indigenous CPUs, GPUs, and exascale computing in collaboration with the India Semiconductor Mission (ISM).

What is the National Supercomputing Mission (NSM)?

About NSM

The National Supercomputing Mission was launched in 2015 as a flagship initiative of the Government of India to enhance the country’s supercomputing capabilities.

• It is jointly steered by the Department of Science and Technology (DST) and the Ministry of Electronics and Information Technology (MeitY).

• The mission is implemented by C-DAC, Pune, and the Indian Institute of Science (IISc), Bengaluru.

Objectives of NSM

• Self-Reliance: To achieve indigenous design, development, and manufacturing of supercomputers.

• Research and Accessibility: To promote HPC-based research and make supercomputing accessible across academic and R&D institutions.

• National Relevance: To develop applications of strategic and societal importance through coordinated efforts of government, academia, and research institutions.

Three-Phase Implementation Strategy of NSM

Phase I: Infrastructure Creation

• Focused on establishing basic supercomputing infrastructure.

• Installed six supercomputers across institutions with significant domestic assembly.

• Aimed at building a domestic ecosystem for component integration.

Phase II: Indigenous Manufacturing

• Shifted focus towards indigenous manufacturing and development of a local software stack.

• Achieved around 40% value addition from Indian sources.

Phase III: Complete Indigenisation

• Focuses on end-to-end indigenisation, including design, development, and manufacturing of key HPC components within India.

Indigenous Technology Development under NSM

Trinetra High-Speed Network

• Trinetra is an indigenously developed high-speed communication network by C-DAC.

• Enhances data transfer and communication between computing nodes.

Key Versions:

• Trinetra-POC: Proof-of-concept system to validate core technologies.

• Trinetra-A: Supports 100 Gbps, deployed in 1 PF PARAM Rudra at C-DAC Pune.

• Trinetra-B: Upgraded 200 Gbps version, planned for deployment in the 20 PF PARAM Rudra at C-DAC Bengaluru.

Petaflop (PF) refers to the capability to perform 10¹⁵ floating-point operations per second.

Rudra Server

• Rudra is India’s first indigenously designed and manufactured HPC server.

• It is supported by an indigenous system software stack, comparable to global HPC-class servers.

• Marks a major milestone in India’s supercomputing self-reliance.

Major Supercomputing Installations in India

• PARAM Rudra (2024): Three supercomputers deployed in Pune, Delhi, and Kolkata, supporting advanced research in physics, earth sciences, and cosmology.

• PARAM Pravega (2022): Installed at IISc Bengaluru with 3.3 PF capacity; the largest academic supercomputer in India.

• PARAM Shivay (2019): NSM’s first indigenously built supercomputer installed at IIT (BHU), Varanasi.

Key Achievements of the National Supercomputing Mission

Infrastructure Expansion

• 34 supercomputers deployed with a combined capacity of 35 PF.

• Systems are spread across IISc, IITs, C-DAC, and institutions in Tier-II and Tier-III cities, improving regional access.

High Utilization Efficiency

• Overall system utilization exceeds 85%, with several systems achieving over 95% utilization, indicating effective use of computing resources.

Human Resource Development

• Five training centres established in Pune, Kharagpur, Chennai, Palakkad, and Goa.

• Over 22,000 professionals trained in HPC and AI, strengthening India’s skilled workforce.

AIRAWAT: India’s AI Supercomputing Platform

About AIRAWAT

• AIRAWAT is a government-initiated AI computing platform providing a shared resource for AI research and innovation.

• It supports research labs, start-ups, industry, and academic institutions connected via the National Knowledge Network (NKN).

Technical Features and Global Recognition

• Developed as a 200 PF mixed-precision AI system, scalable to 790 AI PF.

• Ranked 75th in the Top 500 Global Supercomputing List at ISC 2023 (Germany).

• Positions India among the leading AI supercomputing nations globally.

Key Applications of HPC Systems in India

Weather Forecasting and Climate Modeling

• Enables high-resolution monsoon and cyclone predictions.

• Systems like Pratyush and Mihir deliver resolutions up to 1 km, supporting disaster preparedness.

Drug Discovery and Bioinformatics

• Accelerates genome sequencing, protein folding, and drug screening.

• Played a crucial role in COVID-19 modeling and research.

Artificial Intelligence and Machine Learning

• Platforms like PARAM Siddhi-AI process large datasets for precision medicine, predictive analytics, and AI research.

Material Science and Nanotechnology

• Supports development of advanced materials, semiconductors, and nanomaterials, contributing to Atmanirbhar Bharat.

Defense and National Security

• Enables strategic simulations, cybersecurity research, and high-energy physics applications.

Other Emerging Applications

• Renewable energy modeling

• Oil and gas exploration

• Large-scale industrial and scientific simulations

Conclusion

India’s National Supercomputing Mission represents a strategic effort to achieve technological self-reliance in high-performance computing. By advancing indigenous hardware, software, and human capital, the mission is empowering research across critical sectors and strengthening national security. With a clear roadmap towards complete indigenisation by 2030, India is positioning itself as a global leader in supercomputing and artificial intelligence.

Recently, Prime Minister Narendra Modi extended his greetings to all personnel of the Sashastra Seema Bal (SSB) on the occasion of its Raising Day, appreciating their dedication and service to the nation.

About Sashastra Seema Bal (SSB)

Background and Establishment

The Sashastra Seema Bal (SSB) was earlier known as the Special Service Bureau. It was established on 15 March 1963, following the Sino–Indian Conflict of 1962, with the aim of strengthening India’s border management and internal security framework.

Administrative Control

SSB is one of the Central Armed Police Forces (CAPFs) and functions under the Ministry of Home Affairs (MHA).

Border Responsibility

The force was created specifically to guard India’s international borders with Nepal and Bhutan, which are sensitive due to their open and porous nature.

Roles and Functions of SSB

• Border Security:
  The primary responsibility of SSB is to ensure the safety and security of India’s borders with Nepal and Bhutan.

• Border Community Engagement:
  It works to promote security awareness and foster a sense of cooperation among people living in border areas.

• Prevention of Transnational Crimes:
  SSB plays a crucial role in preventing smuggling, illegal immigration, human trafficking, and other cross-border crimes.

• Regulation of Border Movement:
  The force is responsible for checking unlawful entry into or exit from Indian territory.

• Civic Action and Social Responsibility:
  Under border area development initiatives, SSB undertakes social welfare activities, such as the construction of schools, roads, buildings, and sanitation facilities in border regions.

• Additional Responsibilities:
  SSB may also be deployed for Law and Order duties, Counter-Uprising/Counter-Insurgency Operations, Election duties, UN peacekeeping missions, or any other task assigned by the Central Government.

Organisational Structure

The Sashastra Seema Bal is headed by a Director General, who is usually an IPS officer or a senior CAPF officer.
The force comprises:

• Infantry-style battalions

• Specialised units, including engineering, signals, medical units, and dog squads

• Training centres for operational and professional capacity building

The Supreme Court of India, in Amlesh Kumar v. State of Bihar (2025), set aside a 2025 Patna High Court order that had permitted a narco test. The Court categorically held that any forced or involuntary narco test is unconstitutional, reaffirming earlier constitutional safeguards.

What is a Narco Test?

A narco test is an investigative technique in which the accused is administered sedative or hypnotic drugs, such as Sodium Pentothal (a barbiturate), to lower mental inhibitions.
The objective is to extract concealed information by reducing the person’s ability to reason and exercise conscious control.
Narco tests are often classified as non-violent investigative methods, similar to polygraph and brain-mapping tests.

Constitutional Violations Involved

Violation of Article 20(3): Protection Against Self-Incrimination

Article 20(3) of the Constitution guarantees that no accused person shall be compelled to be a witness against oneself.
Forced narco tests amount to testimonial compulsion, as the responses are extracted from the subject’s mind without free consent.

Violation of Article 21: Right to Life and Personal Liberty

Article 21 protects personal liberty, bodily autonomy, and mental privacy.
Conducting a narco test without the express and informed consent of the accused violates the right to privacy and the right to personal liberty.

Golden Triangle of the Constitution

The Supreme Court in Maneka Gandhi v. Union of India (1978) held that Articles 14, 19, and 21 together form the Golden Triangle of the Constitution.
Any infringement of the right to privacy under Article 21 therefore disrupts this core constitutional framework and undermines due process.

Ethical and Philosophical Considerations

Forced narco tests violate the principle of individual autonomy, which is central to natural justice.
From an ethical perspective, Immanuel Kant’s philosophy emphasizes that actions without consent are morally invalid.
In a democratic criminal justice system, victims’ rights must be balanced with the rights of the accused, and constitutional protections cannot be compromised in the name of investigative efficiency.

Legal Position on Narco Tests in India

Voluntary Narco Tests

A narco test may be conducted only with the free and informed consent of the accused.
Under Section 253 of the Bharatiya Nagarik Suraksha Sanhita (BNSS), 2023, an accused may voluntarily opt for a narco test at the defence stage.
However, there is no absolute or indefeasible right to demand such a test.

Evidentiary Value of Narco Tests

The results of narco tests:

• Do not constitute substantive evidence

• Cannot independently prove guilt

• Require corroboration by independent evidence

Important Judicial Pronouncements

• Selvi v. State of Karnataka (2010): The Supreme Court held that narco tests conducted without free consent are unconstitutional and that their results are inadmissible as evidence.

• Manoj Kumar Saini v. State of Madhya Pradesh (2023): The Court ruled that narco test results cannot be treated as conclusive proof of guilt.

• Vinobhai v. State of Kerala (2025): The Court reaffirmed that narco test results require independent corroboration.

• Amlesh Kumar v. State of Bihar (2025): The Supreme Court struck down forced narco testing and reinforced constitutional safeguards.

Conclusion

The Supreme Court’s ruling clearly establishes that forced narco tests violate constitutional guarantees of dignity, liberty, and privacy.
The judgment strengthens the principle that constitutional morality and due process must prevail over investigative convenience in India’s criminal justice system.

At the inaugural Pax Silica Summit in 2025, India was excluded from the US-led Pax Silica initiative, sparking sharp political criticism domestically and in strategic circles.

About the Pax Silica Initiative

The Pax Silica Initiative is a strategic, US-led effort aimed at creating a secure, resilient, and innovation-driven silicon supply chain.

Objectives

• Reduce China’s dominance over critical minerals and high-tech supply chains.

• Counter coercive dependencies in sectors including:

  • Critical minerals

  • Energy inputs

  • Semiconductors

  • Advanced manufacturing

  • AI infrastructure

  • Logistics

Key Measures

• Promote joint ventures and strategic co-investments in high-tech sectors.

• Protect sensitive technologies and critical infrastructure from countries of concern.

• Build trusted technology ecosystems among participating countries.

Participating Countries (as of December 2025)

• United States

• Japan

• South Korea

• Singapore

• Netherlands

• United Kingdom

• Israel

• United Arab Emirates (UAE)

• Australia

Notably, other Quad members like the US, Japan, and Australia are included, but India is absent.

India’s Position and Future Prospects

• Experts suggest that India could join Pax Silica at a later stage, similar to the Minerals Security Partnership (MSP).

• The MSP, launched in 2022 by the US, aims to secure critical mineral supply chains and reduce dependence on China.

India’s Participation in MSP

• India joined the MSP in June 2023.

• Other partners include: Japan, Australia, the EU, the UK, and Canada.

Focus of MSP

• Minerals like lithium, cobalt, nickel, and the 17 rare earth elements.

• Viewed as an effort to counter China’s dominance in rare earth processing and mining in Africa.

Strategic Implications

• India’s exclusion from Pax Silica has triggered concerns about its participation in the global high-tech supply chain.

• However, its MSP participation demonstrates that India remains a key partner in critical mineral and technology initiatives.

• Future inclusion in Pax Silica could strengthen India’s role in global semiconductor, AI, and advanced manufacturing ecosystems.