This study examines the relationship between India’s stock market performance and gross domestic product (GDP) using econometric modeling. While the global dynamics of this relationship have been extensively studied, its specific implications for the Indian economy have not been fully explored, particularly post pandemic. This research addresses the gap in the existing literature by analyzing the causal connections and long-term equilibrium between India’s stock market (BSE Sensex) and GDP. To achieve this, data from 1993 to 2023 was utilized, employing statistical methods such as the Granger causality test, Johansen cointegration test, and Vector Autoregression (VAR) models. The findings reveal the existence of causal relationship between the two covariates, with both short-term fluctuations and a long-term equilibrium. The results also emphasize the significant role of the stock market in influencing economic growth offering important implications for economic policy and market development. The outcome of this study enhances understanding of the stock market–GDP interconnectedness in India and provides valuable insights for policymakers seeking to leverage financial markets to foster sustainable environmental and economic growth.