The rally was after the World Bank said India's rank on 'ease of doing business' scale has risen from 130th to 100th this year, helped by a slew of reforms in taxation, licensing, investor protection and bankruptcy resolution.
The 30-share BSE Sensex was up 209.28 points or 0.63 percent at 33,422.41 and the 50-share NSE Nifty rose 61.20 points or 0.59 percent to 10,396.50.
About 950 shares advanced against 202 declining shares on the BSE.
SBI, Bharti Airtel, Axis Bank, Yes Bank, Vedanta, Tata Steel and JSW Steel were early gainers.
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