The National Association of State Boards of Accountancy of the United States has written to the Institute of Chartered Accountants of India, warning that it would not push for greater market access for Indian enterprises and professionals in the US market.

The letter, dated June 19, 2003, and signed by a top official of NASBA's International Qualifications Board, refers to recent reports which indicate that "foreign" firms were being exposed to "mischaracterisation" in India.

The tenor of the letter indicated that NASBA considered ICAI as being supportive of this move.

ICAI officials were unavailable for comments despite repeated efforts.

NASBA's letter clearly establishes that the move will hit market access for Indian professionals who sit for examinations under the statewise international qualifications boards to get the qualifications needed to serve in the US market.

The US backlash against the campaign in India will hit not just outsourced accounting contracts but also Indians serving overseas after qualifying through examinations for their affiliation. The norms for the latter were likely to be tightened too.

NASBA said the position being adopted in India distorted the rights to market access being opened up for Indian professionals and firms under the General Agreement on Trade in Services.

It was deeply concerned that the recommendation made to the Indian government by the ICAI working group was inconsistent with the image being made out of Indian professionals being globally competitive.

When contacted, the head of a large accounting firm told Business Standard, "If you seek protection in your own country, you will look like a fool if you claim you are globally competitive".

The US body pointed out that it had supported the opening up of the services sector under GATS and advised the US government to open up the market for services in the US.

The state boards would have the option to block the exams they had evolved and conducted necessary for the licensing of non-US professionals.

The head of another major accounting firm warned, "ICAI has been trying to develop ties with corresponding institutes in Canada, the UK and protectionist moves would jeopardise these relationships as well".