Health Economics Indicators of India: Market Overview and Future Prospects
India, despite significant improvements in public health, continues to face challenges in achieving universal coverage and Millennium Development Goals. While the central government plays a crucial role in programs related to family welfare and disease control, the state governments have taken on primary and secondary healthcare, along with specialty care in some instances. This dual role reflects the complex healthcare landscape in the country, necessitating a collaborative effort between both the public and private sectors to address healthcare demands.
Market Overview
The Indian healthcare market is currently valued at approximately US $100 billion, with projections to reach US $280 billion by 2020. This substantial growth is driven by the increasing focus on healthcare delivery through hospitals, nursing homes, diagnostic centers, and pharmaceuticals, which together constitute 65% of the overall market. With the healthcare spending as a percentage of Gross Domestic Product (GDP) on the rise, there is a significant opportunity to enhance healthcare services.
As per the 2015-16 Union Budget, an allocation of Rs. 33282 crore has been designated for health and family welfare. Furthermore, the rural population, which constitutes over 70% of India, presents a considerable demand source for healthcare services. The increasing number of transactions in the healthcare sector suggests future growth potential, driven by rising healthcare expenditure.
The Growing Medical Tourism Industry
India’s medical tourism industry is currently valued at around US $3 billion annually. With the expected growth to reach US $6 billion by 2018, the number of annual visitors to India for medical treatment is anticipated to double over the next four years. This growth is supported by an increased number of hospitals receiving international accreditation and recognition. The National Medical Tourism Promotion Board, established in this context, aims to further enhance India’s standing as a global medical tourism hub. Additionally, traditional practices such as naturopathy, homeopathy, and Ayurveda are showing signs of revival, contributing to the diversified healthcare offerings.
Challenges and Future Prospects
Despite the growing industry, India faces acute shortages in medical institutions, professionals, and trained staff. Financial constraints limit the government’s ability to provide substantial input, making the private sector a key player. Public-Private Partnership (PPP) models can offer a solution to incentivize private sector participation and enhance healthcare infrastructure.
The healthcare device industry in India is burgeoning, with the country becoming a leading destination for high-end diagnostic services. Coupled with more conscious consumers who prioritize healthcare, India presents vast opportunities for research and development (RD) and medical tourism. This dual focus on infrastructure investment in both urban and rural areas highlights the comprehensive approach needed to ensure equitable access to healthcare.
Source: DIPP, PIB, etc.