Corporate funding for multidisciplinary partnerships likely
New Delhi, May 29, 2026
Synopsis
The Indian government is exploring a significant policy shift. It may permit corporate investments in multidisciplinary partnership firms. This move aims to strengthen their financial base. The goal is to foster large domestic firms capable of competing with global giants. This initiative seeks to enhance India's presence in the international auditing and consultancy market. A final decision is expected soon.
The government is examining a proposal to allow corporate investments in the proposed multidisciplinary partnership (MDP) firms to shore up their capital base, people familiar with the matter said.
The move is part of the efforts to facilitate the creation of large home-grown firms that can rival the Big Four and also grab a slice of the $240-billion global auditing and consultancy market.
The Prime Minister's Office, which is leading the exercise to help create a domestic Big Four, recently asked the corporate affairs ministry for inputs on possible steps to enable MDP firms to raise capital easily and adopt the latest technology fast.
One of the suggestions it received was to consider allowing corporate investments in such firms with strict conditions to address any conflict of interest and other issues, given the limited capacity of individual partners to contribute funds and scale up, the sources said.
The government will soon take a final call on the issue, they said.
Move to shore up capital base of proposed firms
MDP firms have a mix of select groups of professionals, including chartered accountants, company secretaries and cost accountants, working under a single firm structure.
Chartered accountancy firms are currently barred from raising capital through external sources such as private equity or public issues, forcing them to rely mainly on partner contributions.
The restriction severely impairs the ability of such firms to grow big, deploy latest technology such as AI and compete with their global peers.
In fact, less than 1% of accounting firms in India had more than 10 partners each, data compiled by the Institute of Chartered Accountants of India showed.
The absence of large domestic firms has allowed the Big Four-EY, Deloitte, KPMG and PwC-along with Grant Thornton and BDO to dominate the Indian audit and non-audit services ecosystem.
Shaktikanta Das, principal secretary-2 to the PM, has been leading the government's efforts to help create a domestic Big Four. Das has held scores of meetings with senior officials from finance and corporate affairs ministries and the PMO over the past one year.
[The Economic Times]
