Microsoft outage ‘blue screen of death’: India’s BSE and NSE escape the tech bullet with unexpected hero – Lower IT spending?

A cybersecurity update from CrowdStrike caused widespread system outages on devices running Microsoft Windows on July 20. However, the National Stock Exchange (NSE) and the Bombay Stock Exchange (BSE) in India were unaffected, which is a stark contrast to the disruptions faced by other major exchanges such as the London Stock Exchange.

IT spending comparison

Although Indian stock exchanges spent significantly less on their IT infrastructure compared to their international counterparts, they managed to avoid disruptions. According to Business Today, the NSE ₹570 crore for IT spending, significantly less than the London Stock Exchange Group (LSEG) at ₹6,556 crore, NASDAQ at ₹1,949 crore, and the Hong Kong Exchange (HKEX) at ₹6,807 Crores.

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In terms of total costs, the NSE reported ₹3,036 crore, as opposed to NASDAQ’s ₹23,734 crore and HKEX’s ₹69,313 crore. The turnover figures for these exchanges were also reported, with the NSE ₹12,692 Crores, NASDAQ ₹32,574 crore, and HKEX a significant ₹171,575 crore, the report added.

Sebis IT expenses

The Indian stock exchange supervisory authority Securities and Exchange Board of India (Sebi) is also spending significantly less on IT. Annual expenditure is ₹93 crore. This is significantly lower than the Australian Securities & Investments Commission (ASIC) at ₹205 crore and the expenditure of the Monetary Authority of Singapore (MAS) ₹420 Crores.

Insights into system resilience

The resilience of Indian stock exchanges during the outage underscores the importance of system diversity, noted Sanjeev Sanyal, member of the Economic Advisory Council to the Prime Minister (EAC-PM).

He shared his views on X (formerly Twitter), stating: “This is why genetic diversity matters. A unified, interconnected global system is a bad idea. A less interconnected system may seem inefficient, but will be more resilient. This is a key conclusion of the complex adaptive systems-based AI regulatory approach.”

Sanyal has also proposed a comprehensive framework for AI regulation. He suggests setting up a specialised AI regulator with a broad mandate and creating a national registry of algorithms. In his EAC-PM research paper, he highlights the complex nature of AI systems, stating: “AI systems function like CAS (Consolidated Account Statement), with components that interact and evolve in unpredictable ways. This complexity can trigger butterfly effects, where small changes lead to significant and unforeseen consequences.”