The Institute of Chartered Accountants of India is preparing to seek amendments to the Chartered Accountants Act, in a significant policy push aimed at creating larger Indian accounting firms capable of competing with global professional services networks. The initiative reflects a broader regulatory rethink in New Delhi, where policymakers are increasingly focused on whether India's domestic firms have the structural freedom to grow into globally relevant entities.
The proposed changes are expected to go beyond narrow compliance tweaks. According to people familiar with the direction of the discussion, ICAI is reviewing its networking and practice guidelines so that chartered accountancy firms can collaborate more freely, pool capabilities and build scale without running into outdated restrictions. The underlying objective is to move away from a fragmented market dominated by small and mid-sized practices and toward stronger firms with deeper benches, wider service lines and the capacity to serve large corporate clients.
Scale Over Fragmentation
India's accounting profession has long been constrained by rules that limit how firms can associate, brand themselves and expand across geographies. While those restrictions were originally designed to preserve professional independence and ethical standards, they have also made it difficult for domestic firms to match the breadth and institutional depth of the global networks that advise multinational companies. The result has been a market where the largest international assignments often flow to foreign-linked firms or to Indian practices operating within tight structural limits.
ICAI's forthcoming proposal appears intended to address that imbalance. By revising practice and networking norms, the institute is signalling support for a more flexible model in which firms can combine resources, share expertise and potentially build larger platforms without compromising regulatory oversight. For India's professional services sector, that could be a meaningful shift. Larger firms are better positioned to invest in technology, sector specialists, audit quality systems and cross-border advisory capabilities, all of which are increasingly important in a market shaped by complex corporate transactions and global supply chains.
Policy Momentum Builds
The timing of the move is notable. Discussions at the Prime Minister's Office on regulatory adjustments for domestic companies suggest that the issue has moved beyond a purely professional body debate and into the policy mainstream. The government's interest appears aligned with a wider economic strategy: if India wants its firms to compete internationally in manufacturing, mobility, clean energy and services, it may need to remove legacy constraints that keep domestic professional firms small.
That has direct relevance for sectors such as automotive, electric vehicles and mobility, where companies are scaling rapidly, raising capital, entering partnerships and navigating a dense web of tax, audit and compliance requirements. Larger Indian accounting firms could become more capable advisers to these businesses, particularly as supply chains become more global and regulatory scrutiny intensifies around sustainability reporting, transfer pricing and cross-border structuring.
The push also fits into India's broader ambition to build homegrown champions in services, not just in manufacturing and technology. Professional services are often overlooked in industrial policy, but they are critical to the functioning of large enterprises and to the credibility of India's corporate ecosystem. If domestic firms can grow in size and sophistication, they may be able to retain more high-value advisory work within the country rather than ceding it to international competitors.
What Changes May Mean
Any amendment to the Chartered Accountants Act would likely be closely scrutinised by regulators, practitioners and large clients. Supporters of reform argue that India's current framework is too restrictive for an economy of its size and ambition. They contend that stronger collaboration rules would improve efficiency, widen access to specialist talent and help firms build the scale needed to win complex mandates.
At the same time, the profession will be wary of reforms that dilute accountability or weaken audit independence. ICAI will therefore need to balance expansion with safeguards that preserve trust in the profession's core functions. That tension is central to the debate: India wants bigger firms, but not at the cost of quality or ethics.
If the proposed changes are implemented, they could mark an important turning point for the country's accountancy landscape. For decades, the profession has been defined by a large number of small firms and a relatively limited number of large players. A more permissive framework could accelerate consolidation, encourage strategic alliances and create a new generation of Indian firms with the scale to compete for major domestic and international assignments.
For now, the proposal remains at the policy-preparation stage, but the direction is clear. ICAI is positioning itself as a catalyst for structural change, and the government appears receptive to the idea that India's professional services sector needs room to grow if it is to support the country's broader economic ambitions.