The healthcare sector is among the largest sectors in India and has been attracting foreign players. It is crucial that foreign companies have the necessary knowledge about the sector to be able to penetrate the market.
The Indian healthcare sector is among the largest sectors in India both in terms of revenue and employment and has been growing at a tremendous pace, also witnessing significant entrepreneurial initiative over the last few years. The sector is expected to record a threefold rise, at a CAGR of 22% during 2016-2022 to reach USD 372 billion in 2022 from USD 110 billion in 2016.
Various segments such as life sciences, medical devices, biotechnology, pharmaceutical and diagnostics have been attracting foreign players to the country for both collaboration as well as investment purposes. All the same, it is crucial that foreign companies wanting to penetrate the Indian healthcare market understand ground realities and existing trends besides identifying the most appropriate business model and suitable target segment relevant to their offering.
Growing population, increasing affordability, comparative cheaper treatment costs as opposed to the West and medical tourism thereof, increased health insurance penetration, increased patient awareness, out-of-the-box thinking by healthcare players for better operations, government opening up its arms to Public Private Partnership (PPP) and even providing tax holidays will be the key factors to look out for to drive the future of healthcare in India.
About 50% of spending on in-patient beds is for lifestyle diseases; this has increased the demand for specialized care. The Indian home healthcare market is estimated to reach the value of USD 15 to 16 billion by 2020.
Rural India, which constitutes over 70% of the country’s population, is a major demand source keeping in view healthcare spending as a percentage of India’s population. Telemedicine can bridge the rural-urban divide in terms of medical facilities, extending low-cost consultation and diagnosis facilities to villages. Major hospitals have already entered into PPP mode to offer telemedicine services to rural areas.
Digital Health Knowledge Resources, Electronic Medical Record, Mobile Healthcare, Electronic Health Record, Hospital Information System, Technology-enabled care, telemedicine and Hospital Management Information Systems are expected to increase substantially in coming years.
However, healthcare provision remains inequitable and challenges in access to quality, affordable healthcare persist in large parts of the country. The medical devices sector has also grown considerably during this period and plays a critical role at each stage of the healthcare continuum. Although it has been instrumental in improving access and affordability of healthcare services, a number of ecosystem constraints have led to a high dependence on imports for addressing domestic demand.
For more information on business opportunities in the Indian health care sector, please contact:
Ambika Oberoi Sawhney
Senior Market Adviser
Innovation Norway, India