Can India build its own Big Four? The battle moves to the rulebook

The push to build Indian accounting firms capable of taking on the global Big Four -- Deloitte, PwC (PricewaterhouseCoopers), EY (Ernst & Young) and KPMG -- is entering a more consequential phase.

The Institute of Chartered Accountants of India (ICAI) is preparing changes to the Chartered Accountants Act that could alter how Indian firms combine, raise capital and offer professional services, ET has reported today.

Also Read: ICAI readies CA Act changes to build bigger accounting firms


The move follows a year in which the government and ICAI have already tried to make consolidation easier, open global networking and create more opportunities for domestic firms. What is emerging now is less a plan to simply create four large audit firms than an attempt to build Indian professional-services groups with enough scale to compete globally.

Changing the architecture

The immediate peg is ICAI's plan to approach the government with amendments to the CA Act. The institute expects its proposals to be ready within two months, ET reported, citing people familiar with the development. Any amendment to the Act would ultimately require action by the government and Parliament.

The proposals go beyond encouraging mergers. ICAI is considering statutory changes that would recognise aggregation structures and allow capital infusion into Indian accounting firms. It also wants greater flexibility for CAs in consultancy and advisory work, alongside changes to its existing networking and corporate-form-of-practice rules, ET reported.

Also Read: Big Four firms' India operations shine amid global slump

The proposed networking framework could also bring other professions into these structures. Company secretaries, cost accountants, advocates, engineers, architects and actuaries are among those that could participate, according to ET. The idea is to let Indian firms offer the range of services that has helped global professional-services networks become much larger businesses than traditional audit practices.

This proposal is important because a home-grown "Big Four" cannot realistically be built just by stitching together audit practices. The global firms have scale across audit, tax, transactions, risk and consulting. Indian firms will need comparable breadth if they are to compete for multinational clients and large domestic mandates.

Indian Big Four: The birth pangs

The current proposal is the latest in a reform process that began before the government started talking about it again this year. ICAI revised its merger and demerger rules in 2024 and issued guidelines allowing Indian CA firms organised as LLPs to aggregate. The institute said the changes were intended to remove practical obstacles to mergers and improve firms' market presence, efficiency and global competitiveness.

The pace of consolidation appears to have picked up this year. Around 1,000 mergers of CA firms had been approved between February and August 2026. Ten networking structures and 18 management consultancy companies were also registered during the period.

The government's support became explicit in the February Budget. Finance Minister Nirmala Sitharaman said tax rules would be changed "to support PM Modi's vision of home-grown accounting and advisory firms to become global leaders". One measure was to rationalise the definition of "accountant" for the purposes of the safe-harbour rules.

Also Read: Big 4 scores a win as ICAI pauses 'global networking norms'

There was another, more contentious experiment. ICAI introduced global networking guidelines in February, allowing domestic audit firms to identify themselves as part of global networks while imposing disclosure and compliance requirements on those arrangements. ET reported that global firms objected to provisions involving disclosure of commercial arrangements, arm's-length dealings and responsibility for compliance.

In July, ICAI put implementation of those guidelines on hold after discussions with the Ministry of Corporate Affairs. ET reported that the issue had become a point of friction between the institute, domestic firms and the global networks.

That episode showed that building Indian firms is not simply about giving them more freedom. It involves deciding how much room foreign networks should have in India, how domestic affiliates should interact with them and how regulators should oversee those relationships.

Why India wants its own Big Four

India's audit and consulting market is large, but a substantial part of the value generated by large assignments accrues to international professional-services networks. The government wants Indian firms to capture more of that business and eventually earn revenue overseas.

There is also a striking concentration in India's listed-company audit market. Prime Infobase data reported by ET showed that the KPMG, EY and Deloitte groups together accounted for nearly 45% of the market capitalisation of listed companies covered by its FY26 analysis. The global Big Four collectively accounted for 51%. Only 25 audit firms audited 10 or more listed companies while 649 audited just one.

Scale therefore remains a major handicap for Indian firms. A large corporate client does not only buy an audit. It may need tax advice, transaction support, risk management, technology expertise and regulatory advice across several jurisdictions. A firm with a large domestic network and a global brand can cross-sell those services. A fragmented collection of smaller Indian practices cannot do so as easily.

There is also a strategic argument. In April, ETCFO reported based on sources that the PMO was examining possible restrictions on global audit networks for public-interest entities in sensitive sectors such as defence, banking, telecom, energy, digital infrastructure and space. The concern cited by sources was that sensitive Indian corporate information could be accessed or processed through foreign networks. The PMO was also reported to have asked ICAI for proposals to strengthen a domestic audit ecosystem.

These deliberations have not resulted in any publicly announced blanket restriction. But they show why the issue has moved beyond professional rivalry. Domestic capability is increasingly being viewed through the lens of economic sovereignty and data security as well.

The govt is trying to change who gets the work

An important but less noticed part of the story is public procurement. The Finance Ministry's Department of Expenditure had instructed central government departments to avoid disproportionate turnover, net-worth and employee-count requirements in consultancy tenders on the GeM platform, Moneycontrol reported last month based on sources. The directive followed a three-year review which, according to the report, found that some tender conditions were effectively favouring large firms. The report cited examples including a Rs 500-crore net-worth requirement for a Rs 10-crore project and requirements for hundreds of employees even where a much smaller project team was sufficient. It also reported that the new memorandum would not give bidders credit for the experience of parent, subsidiary, affiliate or group companies.

If domestic firms cannot qualify for government assignments because they are small, they have fewer opportunities to build the track record that would make them competitive for bigger mandates.

Procurement reform and the proposed CA Act changes are complementary. One tries to open the market to firms that are not yet huge while the other could help those firms become huge.

A decade-old Big Four plan is speeding up

India's ambition to build its own Big Four is not new. In 2017, Modi told chartered accountants that India should turn the global Big Four into a Big Eight, with four of the eight coming from India. The target did not materialise by 2022, the date originally mentioned in that speech. But the idea has resurfaced with greater force this year.

In his Independence Day address, Modi again spoke about the need for Indian professional-services firms to acquire global scale. At the September 5 centenary event at SRCC, he broadened the argument beyond accounting, asking why Indian consulting, accounting, legal and financial firms could not become global leaders when Indians already lead major companies around the world.

The change in emphasis is worth noting. The original 2017 formulation was explicitly about creating four Indian firms to sit alongside the global Big Four. The current policy discussion has become larger to create an ecosystem in which large Indian professional-services organisations can emerge.

What India still needs to make it work

The first requirement is scale. Mergers can create size but not automatically a coherent organisation. Firms will have to integrate partners, clients, technology platforms, quality systems and professional cultures. The roughly 1,000 reported mergers so far do not by themselves establish that globally competitive institutions are emerging.

Then comes the capital. That's where the proposed CA Act changes would matter. Global professional-services businesses can invest heavily in technology, international offices, specialist talent and acquisitions. Indian firms need a structure that permits comparable investment without compromising audit independence.

Another factor is multidisciplinary capability. The proposed opening to lawyers, company secretaries, engineers, architects and actuaries points directly at this gap. A global client increasingly wants several kinds of advice from one platform. Also, domestic scale is not enough to become a global firm. Indian networks need offices, alliances, talent and clients outside India. ICAI's global networking experiment was aimed partly at this problem, even though its implementation has now been paused.

India will also have to preserve audit independence and quality while pursuing scale. A large firm with extensive consulting interests creates obvious conflicts that regulation must manage. The proposed relaxation of restrictions on non-assurance services will therefore need to be accompanied by safeguards rather than simply deregulation.

The ambition is now becoming clearer than it was a year ago as India has moved from asking why it has no Big Four of its own to changing the rules under which Indian firms operate. The changes are being proposed for the rulebook while media reports suggest the government is already encouraging domestic firms in public tendering.