Why does India’s stock market cap have Taiwan’s and South Korea’s snapping at its heels?

Catching up fast are Taiwan and South Korea; the former’s market cap is now about $4.6 trillion, within sniffing distance of India’s $4.9 trillion, and South Korea’s is at about $4.2 trillion. As much as $2.7 trillion of Taiwan’s gain has come in just the past 12 months, while South Korea too has seen a big leap.

Their upsurge has been driven mainly by investor demand for AI-related stocks—chipmaker TSMC and chip designer MediaTek, for instance, in the case of Taiwan, and AI supply chain participants Samsung and SK Hynix in the case of South Korea.

To be sure, market cap is an unreliable measure of economic health. India might even zip well ahead of those two Asian markets if relief from the Hormuz crisis puts Indian shares on an incline again.

But it does put India’s lack of ‘AI plays’ in the spotlight. It’s obvious that profits can be generated without these, but global investors are mostly looking at AI-hot markets. If we can’t beat them, we may need to join them.