Indexing is a crucial concept in databases important for both exams like GATE and UGC and in job interviews. The discussion begins by explaining the architecture of a computer, focusing on how data querying works. The CPU processes SQL queries, which retrieve information from databases. For instance, a query requesting details about a student is executed by the CPU, but the data resides in memory, specifically in RAM and secondary storage like hard disks. RAM is volatile and directly interacts with the CPU, allowing for faster access to data, whereas hard disks store data permanently but are slower compared to the processing speed of the CPU. The disparity in speeds between CPU and hard disk necessitates the need for indexing, as it enables quick retrieval of data, thus optimizing the performance of database operations. Overall, understanding indexing and its function within the context of computer architecture is vital for efficient data handling in databases.