1994: Market makeover

It was a gigantic leap forward for the Indian equity markets. The National Stock Exchange (NSE) launched its operations which went on to change the face of the markets by ushering in technology-based trading. Its fully-automated screen-based stock trading, linked across the country through a VSAT network, allowed brokers to buy and sell shares from the comfort of their offices.

It was the death knell for the Bombay Stock Exchange or BSE's traditional outcry system, which had become opaque, time-consuming, inefficient and imposed limits on trading in the absence of any technology interface whatsoever. The BSE was forced to follow suit and adopt electronic trading in 1995.

Online trading offered transparent transactions and immediate matching of trades, and went a long way in making the markets more investor-friendly. It also paved the way for further market reforms such as the introduction of derivatives trading in 2000 by both the bourses.

Today, the NSE has 2,799 VSAT-enabled terminals across 1,500 cities and towns and is the largest stock exchange in India in terms of daily turnover and number of trades.

Tech Banking
The Industrial Credit and Investment Corporation of India (ICICI), then a development finance institution, saw an opportunity when the government threw open banking to the private sector. There were many public sector banks with a large branch network but with little automation and poor customer service.

ICICI established a separate banking subsidiary, later renamed as ICICI Bank. The intention was to leverage technology to offer better services at a low cost. Its success forced almost all other banks to embrace technology and streamline operations. Today, after its reverse merger with its parent in 2001, ICICI Bank is India's second-largest bank.

New Telecom Policy
The government unveiled its new telecom policy. The country's teledensity then was an abysmal 0.8 per 100 people as against the world average of 10. The policy aimed at making telephones available on demand by 2007. Licences were awarded to telecom operators for starting cellular services in the metros. The policy laid the foundation for India's emergence as the world's fastestgrowing telecom market with 723 million telephone lines (land plus cellular) and a teledensity of over 60 per cent.

Did you know?
The government announced a new drug policy that scrapped industrial licensing and reduced the number of drugs under price control to help India emerge as a self-reliant, low-cost producer of drugs.

Quote of the year Companies will have to stick to their core businesses and become big players in that area so that they can fight the multinationals. R.C. Bhargava, Managing Director, Maruti Udyog