New Delhi, Sept. 10 -- Households, companies and governments all save and borrow. In India, households, in aggregate, save more than they borrow. We park those savings in physical assets such as real estate and gold, and in financial assets such as cash, bank deposits, mutual funds, equities, insurance and pension plans. The household savings mix has been tilting the wrong way in recent years, with net household financial savings hovering near just 5% of GDP.

Within financial savings instruments, more households, especially of the younger generation, now save through the equity market. Investors registered with the National Stock Exchange crossed 130 million in March, and around 35.5 million of them trade in a given year, up from 4.6 mil...