NSE's dual telecom links failed together, halting India's markets for over 4 hours

At 11:40 am on 24 February 2021, the National Stock Exchange of India halted trading in every segment — cash equities, derivatives and currency — after both of its telecom service providers reported failures on their links. Brokers could not log in or square off positions during one of the busiest stretches of India's retail-trading boom. Trading resumed only at 3:45 pm after the exchange restored connectivity, and the session was extended to 5 pm.

SEBI's show-cause notices alleged the deeper failures: NSE and its clearing arm NCL had not adequately monitored vendors for core and critical activities, had not ensured systems preparedness and readiness to move operations to the disaster recovery site, and had failed to ensure orderly execution of trades and real-time risk management while the market was dark.

In June 2023, NSE and NCL settled without admitting or denying the findings, paying ₹72.64 crore between them. Former MD and CEO Vikram Limaye, NCL MD Vikram Kothari and NSE chief technology & operations officer Shiv Kumar Bhasin also individually settled and committed to at least 14 days of pro bono community service each.

₹72.64 crore (≈$9M) SEBI settlement; four hours of halted trading at India's largest exchange; three executives ordered into community service

Redundancy existed on paper but was never proven in practice — SEBI alleged NSE had not demonstrated preparedness and readiness to shift operations to its disaster recovery site.

Vendor oversight was thin: the regulator alleged the exchange failed to monitor service providers for core and critical activities.

With the market dark, orderly execution and real-time risk management collapsed, so brokers had no way to manage positions for the rest of the session.

Redundancy sharing a failure mode is not redundancy: NSE paid two telecom carriers yet both links failed together. Test disaster-recovery failover for real; critical vendors are your responsibility.

The halt drew a public rebuke from India's Finance Ministry, which asked SEBI to ensure no repeat, and the exchange faced questions over how two supposedly independent telecom links could fail in the same hour. The June 2023 settlement closed the case at ₹72.64 crore plus community service for three executives, and the episode became a reference point for regulators on exchange resilience: SEBI soon tightened scrutiny of technical glitches and the penalties exchanges face for them.