• The Indian stock market has outperformed Warren Buffett's Berkshire Hathaway over the past 25 years.
• Despite challenges like US sanctions and the Global Financial Crisis, the market has shown resilience and delivered positive returns.
• The rise in the Indian stock market is attributed to high growth rate, stable government, and financial discipline.
• The market's performance is part of a broader trend in the global financial landscape, with expectations of continued growth.

In a significant development, the Indian stock market has surpassed the performance of Berkshire Hathaway, the company of the world's wealthiest investor, Warren Buffett, over the past 25 years. This information comes from a report by Helios, a Singapore-based asset management company with a focus on India. The Nifty 500 index has yielded an annual return of 12.56 per cent, compared to Berkshire Hathaway's 9.52 per cent, from July 31, 1999, to July 31, 2024, and that too in US Dollar terms.

This accomplishment is even more noteworthy given the numerous challenges India faced during this period. These included US sanctions following India's nuclear bomb test in May 1998 and the Kargil war in 1999. The Indian markets also demonstrated resilience during the coalition governments. In 2004, the market fell by 17 per cent due to a sudden change of government, and during the Global Financial Crisis of 2008, a sharp decline was also seen in the market. Between 2011 and 2015, the market also faced challenges due to corruption and drought.

Indian Market's Resilience and Performance

Despite these obstacles, the market has successfully weathered these shocks and delivered positive returns to investors. The report also added that despite many challenges and volatility, India has proved that it is a long-term outperformer. The performance of the Indian stock market has also been quite good in the current year. Since the beginning of 2024 till now (August 20), Sensex and Nifty surged 11.66 per cent and 13.60 per cent respectively.

Experts attribute the sharp rise in the Indian stock market to a high growth rate, stable government, reduction in inflation, and financial discipline by the government. The Indian GDP growth rate was 8.2 per cent in FY 2023-24 and is expected to grow at the rate of 7.2 per cent in the current financial year.

Global Financial Landscape and Future Outlook

The Indian stock market's performance is not an isolated event but part of a broader trend in the global financial landscape. For instance, Indian shares recovered from a weak start to end at record closing highs on Thursday, led by information technology stocks as LTIMindtree's better-than-expected results added to expectations of a turnaround in the sector's fortunes. The NSE Nifty 50 added 0.76% to end at 24,800.85, while the S&P BSE Sensex settled 0.78% higher at 81,343.46.

The IT index has gained 7.2% in the four sessions since market leader Tata Consultancy Services' results sparked hopes of a revival in demand for the sector. Besides the positive start to the earnings season from IT companies, expectations of policy continuity in the national budget on July 23 is another trigger for the market rally.

In conclusion, the performance of the Indian stock market over the past 25 years, particularly its outperformance of Berkshire Hathaway, is a testament to the resilience and potential of the Indian economy. Despite numerous challenges, the market has consistently delivered positive returns to investors, demonstrating its long-term viability. The current year has also seen strong performance, with the Sensex and Nifty posting significant gains. This trend is expected to continue, driven by factors such as a high growth rate, stable government, and financial discipline. This achievement underscores the strength and potential of the Indian economy and its financial markets.