The Institute of Chartered Accountants of India is preparing to seek amendments to the Chartered Accountants Act in a bid to create a more enabling framework for Indian accounting firms to grow in size, deepen capabilities and compete more effectively with global professional services networks. The proposed changes, expected to be taken up soon, reflect a broader policy push to strengthen domestic firms so they can serve larger clients, including businesses in fast-expanding sectors such as automotive, electric vehicles and mobility.
The initiative comes at a time when Indian companies are increasingly operating across borders, raising the bar for audit, assurance, tax and advisory services. Large multinational clients often prefer firms with wide geographic reach, specialised expertise and the ability to deploy teams across jurisdictions. Indian firms, by contrast, have long faced structural constraints that have limited consolidation and collaboration. ICAI's planned reforms are intended to address those limitations by making it easier for firms to network, pool resources and build scale without running afoul of existing practice restrictions.
Regulatory Reset
The proposed changes are significant because they go beyond a routine update to professional guidelines. According to the context of the discussions, the Prime Minister's Office has already examined regulatory adjustments that could help domestic companies and professional service providers become more globally competitive. That signals policy interest at a high level in creating an ecosystem where Indian firms can grow into larger entities rather than remain fragmented into smaller partnerships.
For the accounting profession, scale matters. Larger firms can invest more in technology, specialist talent, quality control and sector-specific knowledge. They are also better positioned to handle the compliance and advisory demands of industries undergoing rapid transformation, especially the automotive and mobility sectors, where electrification, software integration, supply-chain restructuring and capital-intensive expansion are reshaping business models. As Indian automakers and EV players expand, the need for sophisticated accounting, transaction support and regulatory expertise is likely to rise.
ICAI's move suggests recognition that the current framework may no longer be sufficient for the ambitions of Indian professional firms. Networking rules, practice structures and collaboration norms have historically been cautious, reflecting a regulatory preference for individual accountability and professional independence. But those same safeguards can also make it difficult for firms to combine capabilities at the scale required to compete with international rivals.
Bigger Firms, Broader Reach
The expected revision of networking and practice guidelines is central to the reform agenda. By allowing broader collaboration, ICAI could help firms share clients, talent and infrastructure more effectively, while still maintaining professional standards. Such a shift would be especially relevant for mid-sized firms that have strong domestic expertise but lack the breadth to win large mandates on their own.
The policy logic is straightforward: if Indian firms can collaborate more freely, they may be able to build national platforms with deeper benches of specialists and stronger regional coverage. Over time, that could reduce the dependence of large Indian corporates on global accounting networks for complex assignments. It could also improve the competitiveness of Indian firms in outbound work, where clients need support in multiple markets.
For the automotive and EV ecosystem, the implications are practical. The sector is capital intensive, heavily regulated and increasingly global in supply chain and financing structures. Companies in this space need advisers who can navigate accounting treatment for incentives, plant investments, joint ventures, cross-border procurement and evolving disclosure requirements. Larger Indian firms could be better placed to serve that demand if the regulatory environment becomes more flexible.
What Comes Next
The next step will be the formal proposal of Act changes, after which the contours of the reform package will become clearer. Any amendment to the Chartered Accountants Act would require careful balancing: regulators will want to preserve audit quality, independence and public trust even as they encourage scale and collaboration. That tension is likely to shape the debate around how far the profession can consolidate and what forms of networking should be permitted.
Still, the direction of travel is clear. India is trying to build institutions that can match the scale of its economy. In the professional services sector, that means moving beyond a model of many small firms toward one that supports larger, more capable entities with the reach to serve complex domestic and international clients. ICAI's planned changes could become an important step in that transition, especially if they are backed by broader regulatory support from the government.