Can India create homegrown giants to rival the Big Four consulting firms?

This is the question the government is exploring as it seeks to reduce dependence on foreign majors and tap into the country’s vast talent pool to create Indian champions in professional services that can rival the Big Four (EY, KPMG, Deloitte and PwC).

India has served as the world’s back office and knowledge hub for decades, but translating this comparative strength into competitive global dominance remains a formidable challenge.

Domestic dividend

Since the liberalization reforms of the early 1990s, India’s growth story has been driven by the services sector, which has consistently contributed 50-55% of the country’s total gross value added (GVA), far surpassing agriculture and manufacturing.

The biggest force behind this increase was professional, scientific and technical services. In the last decade alone, GVA in this subsector has almost tripled. ₹30,000 crore in 2013-14 ₹84,000 crore in 2023-24. This performance is based on India’s distinct advantage in human capital.

Every year, the country produces a large pool of engineers, MBAs and chartered accountants who are English-speaking, technically proficient, earn affordable wages and can work in different time zones. This workforce is capable of performing a wide range of tasks, from basic analytics and compliance checks to complex consulting projects and high-level audit engagements.

But the paradox is that these professionals do not empower Indian companies. Instead, their expertise is channeled by foreign multinationals that leverage their skills at a fraction of global wage costs.

comparative edge

India’s deep pool of skilled professionals has helped it emerge as a global hub for highly skilled service exports. According to the latest data from the World Trade Organization, the country’s exports of professional and management consulting services are almost three times the world average, outpacing many developed economies such as Singapore (1.96), the United Kingdom (1.44) and the United States (1.24). In 2024, India exported consultancy services worth $125.7 billion, accounting for nearly one-third of its total services exports of $374.9 billion.

Much of this work is carried out through global capability centers (GCCs) of foreign multinationals. Unlike separate legal entities, GCCs function as extensions of their parent companies and focus on technology development, data analytics, R&D, finance, HR and shared services for global customers.

With more than 1,800 Gulf States, India is now home to more than half of the world’s total, and this number is expected to rise to 2,400 by 2030, according to EY estimates. II. Tier-1 cities are increasingly joining this wave, pushing India’s domestic GCC market towards an estimated $110 billion by 2030.

giant void

Total global revenue for the Big Four firms increased from approximately $94 billion in 2009 to approximately $212 billion in 2024. The Big Four therefore account for the lion’s share of the market, as the global consulting and auditing industry is currently worth approximately $240 billion. Decades of global expansion, a deep base of multinational customers and a reputation for quality and scale have cemented this dominance.

Additionally, their large talent pool, common methodologies and shared technology platforms have helped them ensure consistent service delivery globally. This global superiority is also reflected in India’s consulting and auditing environment. Indian arms revenues are estimated to exceed $5.4 billion in FY25, a growth that has outpaced major networks.

India’s largest listed companies rely heavily on the Big Four, along with Grant Thornton and BDO, and estimates suggest they control more than two-thirds of Nifty 500 companies. Strong brand reputation and global credibility continue to attract Indian customers from across industries.

fragmented market

In stark contrast to the huge scale of the Big Four, Indian firms are small and fragmented. Take this for example: Of the nearly 95,000 firms registered with the Institute of Chartered Accountants of India, about 70,000 are proprietors or sole practitioners. Only about 400 have more than 10 partners; This is a fraction of its global peers.

This lack of scale is further exacerbated by regulatory hurdles. Current rules restrict the formation of multidisciplinary partnerships, preventing accountants, lawyers, actuaries and company secretaries from operating under a single firm structure. This limits collaboration and the ability to deliver the kind of integrated, full-service solutions that international firms provide.

Strict regulations on advertising and branding further hinder growth, making it difficult for domestic companies to gain visibility and compete globally. Licensing adds another layer of complexity, with different regulators governing different professions and operating in silos; this further encourages fragmentation and weakens the competitive position of Indian firms.

AI concerns

India’s drive to build its own globally competitive multi-disciplinary partnership firms comes at a time when the future of traditional high-skill services such as consulting is being reshaped by artificial intelligence (AI) and questions are being raised about the need for human consultants.

A recent experiment by Harvard Business School and Boston Consulting Group found that the AI ​​tool GPT-4 could perform routine consulting tasks such as idea generation, market segmentation, and report drafting faster and more accurately than human consultants.

Additionally, AI can act as a powerful equalizer by elevating the bottom line of consulting performance, while also allowing higher performers to further increase their productivity. But when it comes to advanced functions such as strategic recommendations, integrated decision-making, and solving complex business problems, human expertise is vital.

As a result, consulting firms are moving away from low-quality, repetitive assignments and looking for individuals who can take on higher-value, strategic work.

For India, therefore, building globally competitive firms will require more than scale. Investment will be needed in developing professionals who excel at advanced problem solving and critical thinking, areas where human judgment will continue to be critical.

Puneet Kumar Arora is an assistant professor of economics at Delhi Technological University. Jaydeep Mukherjee is professor of economics at Shiv Nadar University, Chennai.