Accounting firms currently being targeted by a section of the chartered accountants for being 'foreign' have warned that the campaign would only serve to scare away foreign direct investment, which would flow into India through  outsourcing contracts for back-office accounting service.

It would also lead to an inevitable backlash in Europe and USA where lobbies will succeed in getting legislatures to tighten visas and other market access hurting India at a time when the outsourcing sector was riding a growth trajectory.

Roopen Roy, managing director of PricewaterhouseCoopers India, one of few willing to go on quote to Business Standard, said, "My submission is that PwC India was born in Kolkata over 120 years ago and continues to be fully Indian-owned and under Indian management. We are more 'swadeshi' than many stock market highfliers, who, having accessed global capital markets, have "foreign" shareholders. But the campaign is hurting projects we are pitching for overseas."

When the country was seeking unrestricted access for software, information technology and BPO services in the overseas market and the government was committed to opening up the services sector, these noises will send wrong signals to the rest of the world, he warned.

Industry heavyweights pointed out that so-called 'swadeshi' movements in the US would get a fresh excuse to delay if not restrict Indian access by placing restrictions on visas and by banning IT and BPO work to be awarded to India-based companies.

"As one in favour of a globalised economy,  I cannot expect a GE to move backoffices employing 18,000 people and then say you got to be audited by a 100 per cent pure 'swadeshi' auditor of my choice because we have banned all accountants who have any connections with foreign firms or who have a foreign sounding name", Roy added.

Some PwC organizations, for example, were looking at moving some back office operations to India.

"They certainly would be concerned if a fringe group says, 'You are not welcome', because there are many countries rolling out a red carpet and they have a choice", he warned.

The protectionist move would also deny Indian accountants, whether cost accountants, chartered accountants or members of any other accounting institution, as global companies would retaliate.

"Firms like PwC India dream, aspire and execute to become global players based in India. By 2008, almost 7 per cent of India's GDP will come from digitized services", Roy said to highlight the opportunities before Indian knowledge workers.

PwC has two subsidiaries, one in the UK fully owned by the Indian venture, and one in Sri Lanka 51 per cent owned. Both earn in foreign exchange.

A source in another Big 4 firm in India said, "We fiercely compete against each other and I neither know nor will I hold brief for other large firms".

PwC India, for instance, offered IT and software services for the other PwC network firms and also in its designated markets in areas like privatisation and government reforms and computer security. PwC was also one of the first and largest investors in IT.