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Emerging Trends: Indian Law Firms Expanding into Tier 2 Cities

In a notable shift, Indian law firms are extending their reach beyond the bustling metros, setting up shop in smaller yet burgeoning centers like Nashik, Indore, Chandigarh, Jaipur, Pune, Ahmedabad, and Kochi.

This strategic move is driven by various factors, including the pursuit of cost arbitrage, catering to a growing corporate and private client base, and fostering client retention.

Leading firms such as Khaitan & Co., Desai & Diwanji, Khaitan Legal Associates, and Economic Laws Practice have recognized the commercial advantages of establishing physical offices in these areas. According to representatives, the presence of burgeoning corporate and private client portfolios in tier 2 cities, coupled with the availability of local talent and cost advantages, forms a compelling business case for expansion.

Amar Sinhji, executive director of human resources at Khaitan & Co., emphasized the increasing demand for quality legal services in tier 2 cities driven by India’s economic growth. This expansion includes setting up offices in Ahmedabad, Pune, and potentially more such towns, reflecting the firm’s commitment to meeting the evolving needs of its clients.

Similarly, Desai & Diwanji’s recent establishment of offices in Pune and Indore aligns with its strategy to better serve clients in underserved locations. Shreevardhan Sinha, senior partner at the firm, highlights the anticipated demand for legal services across various business activities, necessitating a nuanced understanding of local dynamics and the provision of specialized services.

Khaitan Legal Associates is also venturing into tier 2 cities, with plans to set up a satellite office in Nashik. Senior partner Sakate Khaitan underscores the strategic advantage of expanding reach while maintaining proximity to key business hubs like Mumbai.

Khaitan & Co.: Top law firms rule in favour of smaller cities; plan to hire  local talent in Nashik, Pune, Indore, Jaipur & Chandigarh - The Economic  Times
Source: The Economic Times

Beyond economic considerations, the availability of high-quality local talent, including graduates from prestigious institutions like National Law Universities, further incentivizes law firms to explore tier 2 cities. Additionally, the perceived better quality of life and cost advantages contribute to the attractiveness of these locations for both firms and employees.

Looking ahead, Economic Laws Practice (ELP) intends to establish a presence in towns and cities where its clients have manufacturing units, such as Pune and Ahmedabad, further solidifying the trend of legal firms expanding into tier 2 cities.

The expansion of Indian law firms into tier 2 cities signifies a significant shift in the legal landscape. As firms capitalize on cost arbitrage, client proximity, and local talent availability, it is plausible that other larger firms will follow suit. Tier 2 cities are poised to emerge as new hotspots for legal services, offering a blend of economic viability and growth opportunities in the legal sector.

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