Top 6 Growth Drivers For The Indian Healthcare Sector

The Indian healthcare industry comprises hospitals, medical devices, clinical trials, outsourcing, telemedicine, medical tourism, health insurance, and medical equipment. The Private Equity Investment in India is growing at a tremendous speed due to its strengthening coverage, services, and increasing expenditure by public and private players.

• The hospital industry is expected to reach $132 bn by 2023 from $61.8 bn in 2017; growing at a CAGR of 16-17%, accounts for 80% of the total healthcare market and it is seeing a huge investor demand from both international and national private equity investment firms.
• The Indian Medical Tourism Market is expected to grow from its current size of $3 bn to $7-8 bn by 2020. 
• The diagnostics industry in India is currently valued at $4 bn. The share of the organized sector is almost 25% in this segment (15% in labs and 10% in radiology).
• The primary care industry is currently valued at $13 bn. The share of the organized sector is practically negligible in this case.
• 70,000 Ayushman Bharat centers, which aim at providing primary health care services to communities closer to their homes, are operational in India.
• The market size of AYUSH has grown by 17% in 2014-20 to reach $18.1 bn and the industry is projected to reach $23.3 bn in 2022.  
• Health insurance contributes 20% to the non-life insurance business, making it the 2^nd largest portfolio. The gross direct premium income underwritten by health insurance grew 17.16% year-on-year to reach $6.87 bn in FY20.

Growth Drivers

• Robotic process automation (RPA)
• Robotic Process Automation:  To improve the efficiency of the healthcare workforce; reducing costs and creating the value proposition.
• Shifting Disease Pattern: Non-Communicable Diseases (NCDs) account for 50% of the disease burden and 60% of all deaths in India.
• Medical Tourism: Due to the relatively low cost of medical care in India, medical tourism is experiencing a 22-25% growth. It contributes over $2Bn to the healthcare market in India. Increased demand for healthcare and medical devices from rise in medical tourism.
• Government Policy: 100% FDI allowed in Greenfield & Brownfield projects, measures to correct unfavorable duty structure are being undertaken, single window clearance e-portal to improve EoDB.
• Insurance Coverage: 20% Indians covered; expected to rise with rising incomes, urbanization.
• Medical Infrastructure: Over $200 bn to be spent on medical infrastructure by 2024

The Indian healthcare sector is much diversified and is full of opportunities in every segment, which includes providers, payers, and medical technology. With the increase in the competition, businesses are looking to explore the latest dynamics and trends which will have a positive impact on their business. Private Equity Investment in India will play a major role in boosting healthcare services.