The Institute of Chartered Accountants of India is preparing a significant regulatory push that could alter the structure of India's accounting profession and help domestic firms grow into larger, more globally competitive entities. According to people familiar with the matter, the institute will soon propose changes to the Chartered Accountants Act and associated practice rules, with a focus on enabling broader collaboration among firms and easing long-standing limits that have kept many Indian practices relatively small.
The initiative comes at a time when India is trying to build stronger homegrown professional services firms capable of serving large corporations, cross-border businesses and complex regulatory mandates. In sectors such as automotive, electric vehicles and mobility, where companies are navigating rapid technology shifts, supply-chain realignment and capital-intensive expansion, demand for sophisticated audit, tax and advisory support is rising. Policymakers increasingly view larger domestic accounting firms as part of the broader infrastructure needed to support Indian industry's global ambitions.
Regulatory Reset
The proposed changes are expected to focus on networking and practice guidelines, two areas that have historically shaped how chartered accountancy firms can collaborate, share resources and expand their client reach. At present, fragmented ownership and practice structures have made it difficult for many Indian firms to build the scale, geographic spread and specialist depth that large multinational networks offer. ICAI's review is intended to create more room for consolidation and coordinated practice models without compromising professional standards.
The matter has also been discussed at the level of the Prime Minister's Office, underscoring the policy significance attached to the issue. Officials have been examining whether regulatory adjustments can help domestic firms become more competitive, not only within India but also in international markets where Indian companies increasingly need advisory support that matches global benchmarks. The push reflects a wider government interest in strengthening Indian professional services as an exportable capability.
Bigger Firms, Wider Reach
For the accounting profession, the central question is scale. Indian firms have long been respected for technical competence, but many remain smaller than global networks that dominate large audits and complex advisory assignments. That gap matters as Indian companies expand overseas, raise capital abroad, or operate in highly regulated industries that require integrated services across jurisdictions. Larger firms can invest more heavily in technology, sector expertise, quality control and talent development, all of which are becoming essential in a fast-changing business environment.
The automotive and mobility sector illustrates the challenge. Traditional vehicle manufacturers, EV startups, battery suppliers and charging infrastructure companies all face distinct accounting, tax and compliance issues. As these businesses grow, they often require firms that can handle multi-layered reporting, transaction support, transfer pricing, ESG-related disclosures and cross-border structuring. A more flexible regulatory framework could allow Indian accounting firms to assemble the scale and specialisation needed to compete for such mandates.
ICAI's planned revisions are also likely to be watched closely by mid-sized firms, which may see an opportunity to expand through alliances, shared platforms or deeper practice integration. If implemented carefully, the changes could encourage a more competitive market without forcing firms into a one-size-fits-all model. But the transition will require balancing growth with independence, audit quality and ethical safeguards, especially in a profession where trust is central.
Market Implications Ahead
Any amendment to the Chartered Accountants Act would be closely scrutinised by practitioners, corporate clients and regulators. The profession has historically been cautious about structural change, in part because audit integrity and professional independence are non-negotiable. Still, the pressure to modernise has intensified as Indian businesses become more complex and as global firms continue to dominate the upper end of the market.
If ICAI succeeds in broadening networking and practice rules, the impact could extend beyond accountancy. Larger domestic firms could support Indian corporates more effectively in fundraising, overseas expansion, mergers and acquisitions, and compliance with increasingly demanding disclosure standards. That would align with the government's broader objective of building stronger Indian institutions that can compete internationally on capability, not just cost.
For now, the proposal signals a clear policy direction: India wants its professional services sector to grow up alongside its industrial ambitions. In a market where automotive and EV companies are scaling rapidly and seeking more sophisticated financial guidance, the ability of Indian accounting firms to expand may become a strategic advantage rather than a purely professional reform.