India's Big Four: PMO pushes reforms to build domestic advisory champions

The Prime Minister’s Office (PMO) has quietly but deliberately escalated a long-running policy debate: can India build its own global-calibre advisory giants to challenge the entrenched dominance of the international Big Four — Deloitte, PwC, EY and KPMG — and, if so, what structural reforms are required to make that possible? The June meeting convened by Principal Secretary Shaktikanta Das brought secretaries from Corporate Affairs, Revenue and Financial Services together with economic advisors to explore regulatory, procurement and capacity-building steps intended to enable domestic Chartered Accountancy (CA) and consultancy firms to scale nationally and compete internationally. (economictimes.indiatimes.com) (moneycontrol.com)
This is more than symbolic ambition. India’s professional services market is rapidly growing, and the Indian arms of the Big Four generated an estimated combined revenue of roughly ₹38,500–₹38,800 crore in FY24 and are projected to exceed ₹45,000 crore in FY25 — a surge driven largely by consulting and government work. That concentration of public-sector advisory spend has prompted calls from domestic firms and policymakers for urgent reforms to procurement and regulatory frameworks so home‑grown players have a fair path to scale. (economictimes.indiatimes.com, moneycontrol.com)

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Background: why the PMO is accelerating the debate​

India’s professional services ecosystem has been shaped by decades of global networks operating through local affiliates, regulations that historically constrained domestic CA firms’ ability to merge or partner, and procurement practices that frequently reward scale measured by revenue or headcount rather than technical competence. The PMO meeting follows earlier moves — including ICAI’s approval of draft guidelines aimed at creating a more enabling environment for domestic CA firms and discussions about forming a government panel to map an actionable roadmap — signaling a shift from talk to policy design. (economictimes.indiatimes.com)
Several practical drivers explain the urgency:

• Government programmes and disinvestment activity have created a large pipeline of advisory work that global networks have been quick to capture.
• Concerns over competitive neutrality, data sovereignty and project confidentiality have been raised where international firms act as Project Management Units (PMUs) or advisors on sensitive projects.
• Domestic firms argue that turnover-based eligibility criteria in tenders and empanelment rules prevent capable Indian firms from competing for government work that would give them the experience needed to scale.

Each of these points has surfaced repeatedly in reporting and industry statements over the past year, and they now form the nucleus of the PMO’s review. (moneycontrol.com, indianexpress.com)

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The current landscape: facts, figures and concentration​

Big Four footprint and revenue dynamics​

The Big Four’s India operations have outpaced their global parents in growth rates, driven by consulting, technology and government assignments. Estimates and industry reporting put combined FY24 revenues of the Big Four’s Indian arms at close to ₹38,800 crore, with projections to cross ₹45,000 crore in FY25 if current run-rates persist. This revenue boom underscores how much of their India growth now depends on advisory and consulting services rather than classical audit alone. (economictimes.indiatimes.com, business-standard.com)

Public sector contracting patterns​

Public procurement records and Right to Information (RTI) based investigations show the Big Four and a handful of global consultancies captured a disproportionately large share of central government advisory mandates over recent years. Between 2017 and 2022, the Big Four plus McKinsey secured hundreds of assignments across multiple ministries, together amounting to nearly ₹500 crore in value in that period — evidence of deep penetration into the public consulting market. Such assignments ranged from financial due diligence to project management and policy evaluation, and they were spread across critical ministries including petroleum, power and information technology. (indianexpress.com, consultancy.in)

Procurement thresholds and empanelment criteria​

A paramount industry complaint is the use of high turnover and headcount conditions in empanelment and tender eligibility. Agencies such as NICSI have categories that effectively raise the bar for participation in many government tenders. Domestic consulting leaders point out that empanelment bands and typical evaluation frameworks (e.g., turnover and minimum employee counts) can disqualify firms that are technically qualified but not yet large enough by revenue. Recent journalism and industry comments describe empanelment thresholds in some cases as high as several hundred crores — a structural barrier that prizes scale over demonstrated competence. (moneycontrol.com, scribd.com)

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Fault lines: governance, conflict of interest, and national security concerns​

The Satyam scar and governance mistrust​

India’s most notorious corporate accounting fraud, the Satyam scandal, remains a potent memory shaping public policy and trust. U.S. and Indian regulators found audit deficiencies by affiliates of the auditor that allowed the fraud to go undetected; subsequent enforcement actions included SEC sanctions and a SEBI-imposed audit ban on Price Waterhouse’s Indian network. That episode is regularly invoked by critics who argue that overreliance on global networks has systemic risks that require policy attention. (sec.gov, bbc.com)

PMUs, privileged information and competitive advantage​

When the same players who design or manage projects are also active bidders for follow-on consultancy work, questions of competitive neutrality arise. Observers point to the structural problem: PMUs have deep access to project design, procurement timelines and technical specifications, which can create knowledge asymmetries if those PMUs or their network affiliates later bid on adjacent work. Reporting and industry commentary have raised this as a governance and information-security risk in public procurement. While not every PMU engagement leads to inappropriate advantage, the pattern has heightened calls for clearer conflict‑of‑interest rules and stricter project information firewalls. (indianexpress.com)

Data sovereignty and sensitive advisory mandates​

Beyond commercial fairness, national security and data protection are part of the debate. Government projects often touch citizen data, financial modelling, or infrastructure plans. The involvement of foreign-origin advisory networks in mission-critical roles has prompted policymakers and industry leaders to ask whether certain advisory functions should be ring-fenced or preferentially reserved for audited domestic entities to reduce sovereignty risk. These concerns mirror parallel debates about cloud dependency and foreign platforms in India’s digital infrastructure.

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What the PMO discussed — and what it did not decide​

The PMO meeting chaired by Shaktikanta Das reportedly focused on a menu of options: forming a high-level panel to map reforms, revisiting ICAI rules on domestic firm tie-ups and overseas affiliations, and reviewing tender and empanelment norms that create de facto advantages for large international networks. Officials present included secretaries from Corporate Affairs, Revenue and the Department of Financial Services alongside members of the Economic Advisory Council. No public commitment to a single path emerged; rather, the meeting was a diagnostic step toward a policy roadmap that would likely combine regulation, procurement reform and incentives for consolidation among domestic firms. (economictimes.indiatimes.com, outlookbusiness.com)
Key policy levers discussed in public reporting include:

• Regulatory changes to clarify how Indian CA firms can form strategic tie-ups or joint ventures without violating professional independence or foreign equity rules.
• Procurement reform to shift qualification emphasis from raw turnover metrics to competence-based measures, certifications and outcome track records.
• Support for consolidation via incentives for M&A among mid-sized Indian firms to build scale and fund international expansion.
• Capability building including access to capital, international placements, and standardized quality-control frameworks.

ICAI’s draft regulatory framework and efforts to allow structured affiliations and tie-ups is a concrete step in that direction — but it has already drawn pushback from some global firms who argue the rules may impose onerous disclosure and governance requirements. (economictimes.indiatimes.com)

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Strengths of the PMO’s approach​

• Strategic coherence: The initiative aligns with broader industrial and strategic goals — building domestic capability in services, protecting sensitive projects, and reducing reliance on external networks for critical advisory work.
• Real economic rationale: India’s large talent pool, accelerating economic complexity, and expanding public investment programs create a natural market for home-grown advisory firms with the right scale and international credentials.
• Regulatory momentum: ICAI’s draft moves and the prospect of a government panel provide immediate institutional levers to address historical regulatory constraints that have impeded mergers, external capital flows, and brand building for domestic firms. (economictimes.indiatimes.com)

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Significant risks and blind spots​

Despite the promise, several structural and practical obstacles could frustrate the PMO’s aims if not addressed with care.

1) Procurement reform is necessary but politically difficult​

Changing tender and empanelment rules that currently emphasize turnover and headcount will provoke bureaucratic resistance and require clear, objective alternatives. Public agencies often default to simple quantitative filters (turnover, employee count) to reduce procurement risk and administrative burden. Replacing those with competence-based, outcome-oriented assessments requires new templates, training and transparency safeguards. Evidence shows agencies have historically preferred scale-based metrics as a proxy for delivery risk; altering that mindset is non-trivial. (moneycontrol.com, government.economictimes.indiatimes.com)

2) Consolidation versus competition balance​

One route to creating “India’s Big Four” is consolidation among domestic players. Yet aggressive consolidation risks replacing a few mid-sized firms with a small number of larger incumbents that may replicate the market concentration problem rather than resolve it. Policymakers must ensure that consolidation is paired with competition safeguards and quality-of-service benchmarks.

3) Risk of regulatory overreach or protectionism​

While the goal of promoting domestic champions is understandable, protectionist policies or opaque preferential treatment could backfire by reducing competition, increasing costs and creating complacent domestic monopolies. The objective must be competitive enablement, not closed markets.

4) Governance and independence for audit and advisory services​

Any push to scale domestic advisory firms must preserve audit independence and avoid conflicts of interest where audit and consulting businesses mix. ICAI’s draft frameworks attempt to square that circle, but global networks are already pushing back — highlighting the complexity of reconciling client confidentiality, quality control, and disclosure requirements across borders. (economictimes.indiatimes.com)

5) Unverified anecdotal claims require scrutiny​

Some industry commentary cites extreme examples — for instance, allegations that certain ₹50 lakh consultancy assignments included turnover eligibility as high as ₹100 crore. Publicly available tender data and RTI findings do confirm many instances of large thresholds, but direct, document‑level examples of the specific ₹50 lakh/₹100 crore mismatch cited in media coverage were not readily found in the public domain during reporting. Such claims should be treated as indicative of a pattern, not as universal truth, until specific tender documents are identified and validated. Journalists and policymakers will need to demand granular tender archives and employ RTI tools to verify and, if needed, correct procurement practices. (ndtvprofit.com, economictimes.indiatimes.com)

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Practical reforms that would make policy deliverable​

If the objective is to foster credible, globally competitive Indian advisory firms without reducing procurement quality or increasing risk, a multi-pronged program is required. The following steps combine operational practicality with political feasibility:

• Reform procurement evaluation to emphasize:
• Relevant project experience, technical certifications and third-party quality audits over raw turnover thresholds.
• Use of scorecards that reward demonstrable outcomes, domain expertise and security certifications.
• Create tiered empanelment bands:
• Lower entry bands for smaller firms for projects up to defined value limits; larger projects could still require higher financial stability.
• Reserve a meaningful share of advisory tasks for domestic firms until capacity naturally grows — but ensure this does not become permanent protectionism.
• Strengthen conflict-of-interest and PMU governance:
• Mandate transparent information firewalls and cooling-off periods for firms that serve as PMUs before bidding on related implementation contracts.
• Require public disclosure of PMU assignments, timelines and staff lists to enable auditability.
• Facilitate consolidation with guardrails:
• Offer tax and transaction incentives for mergers that demonstrably improve capability and compliance, paired with antitrust reviews and service-quality benchmarks.
• Fund capability building:
• Set up a government‑backed “Professional Services Growth Fund” to provide patient capital for scaling Indian firms, focused on international certifications, technology investments, and cross-border capacity.
• Upgrade professional standards and monitoring:
• Fast-track ICAI quality-control frameworks, institute robust peer-review and independent monitoring for large public-sector audits and advisory assignments.
• Publish procurement datasets:
• Require ministries and major agencies to publish historical tender data, contract awards and selection rationales in machine-readable form to enable independent verification and civil‑service accountability.

These measures combine immediate procurement fixes (which can open opportunities for mid-sized domestic firms) with medium-term structural reforms to produce genuinely competitive national champions.

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How domestic firms can position themselves​

• Build verifiable sector specialization and outcome-based case studies.
• Invest in international certifications (ISO, CMMI, cybersecurity standards) and independent third-party audits that substitute for turnover in credibility.
• Consider strategic mergers that preserve entrepreneurial culture while pooling capital and capability.
• Strengthen governance and disclosure mechanisms to reduce regulatory pushback and to build trust with public agencies.
• Use international partnerships selectively to gain capability transfer while retaining domestic control of sensitive data and project work.

These actions reduce the chicken-and-egg problem: firms need government projects to scale, but they need scale to qualify for those projects. Competence‑weighted procurement and targeted public support can break the cycle.

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The geopolitics and global competition angle​

Creating domestic champions in professional services is not purely an economic objective — it has geopolitical dimensions. Advisory work often intersects with critical infrastructure, financial markets and national data. Reducing over-reliance on foreign-origin firms for sensitive advisory roles can enhance strategic autonomy, but must be balanced against the benefits of global knowledge flows, specialized expertise, and cross-border capital. The policy challenge is to design domestic capability without retreating from global engagement. In comparable debates across digital infrastructure and cloud services, India has adopted a mixed strategy: strengthen domestic alternatives where sovereignty risk is highest and preserve managed global partnerships where necessary. The same pragmatic posture will be needed for advisory services.

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Where the debate goes from here​

The PMO’s meeting is a diagnostic milestone rather than a final declaration. Expect the following near-term outcomes:

• Formation of a technical panel or working group under Corporate Affairs to propose concrete edits to ICAI rules and suggest procurement adjustments. (economictimes.indiatimes.com)
• A coordinated review by Department of Expenditure and central procurement bodies of empanelment thresholds for NICSI and other agencies, with pilot changes on selected categories (e.g., non-sensitive advisory assignments) to measure impact. (moneycontrol.com)
• Heightened scrutiny of PMU arrangements and new guidance on conflicts of interest for agencies awarding multi-stage advisory and implementation contracts. Evidence from RTI-based investigations and news reporting makes such scrutiny politically salient. (indianexpress.com)

All of these steps will require careful drafting, stakeholder consultation (including the Big Four and domestic firms), and transparency to avoid either protectionism or regulatory capture.

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Conclusion — realistic ambition, rigorous execution​

The PMO’s push to create “India’s Big Four” is an ambitious policy bet with clear merit: stronger domestic advisory capacity would deepen India’s economic sovereignty, retain higher-value jobs domestically, and diversify the marketplace for high-end professional services. But achieving that outcome demands pragmatic, enforceable reform across procurement, professional regulation and capability financing. Counting on slogans alone will not suffice.
Success will depend on the government adopting competence-led procurement, targeted incentives for consolidation that preserve competition, and robust governance rules to prevent conflicts of interest — while simultaneously raising the quality and international credibility of domestic firms through standards and capital support. If implemented thoughtfully, India can expand its domestic advisory champions without sacrificing quality, openness or value for taxpayers. If implemented carelessly, reforms risk trading one form of concentration for another.
The debate opened in the PMO is the right conversation at the right time; its value will be measured by the concrete, verifiable steps that follow — changes to tender norms, strengthened professional frameworks, published procurement data and demonstrable increases in domestic firms’ share of meaningful government advisory work. The path to “India’s Big Four” lies not in exclusion, but in creating rules that reward competence, transparency and national interest. (economictimes.indiatimes.com, moneycontrol.com, sec.gov)

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Source: itvoice.in https://www.itvoice.in/debate-intensifies-as-pmo-pushes-for-indias-big-four-amid-concerns-over-existing-global-players-dominance/