The government of India estimates that the Indian healthcare industry will grow to USD 280 billion by 2020, with the medical technology market sector more than doubling by 2017 to reach USD 9.5 billion, according to German Trade & Invest (GTAI)[1]. By 2025 India needs 1.8 million more beds, 1.54 million more doctors and 2.4 million more nurses to meet growing demand. This rapid growth is required to meet the equally rapid increase in demand. The country’s population is growing rapidly, with rising incomes and increases in diseases of “affluence”, a growing number of old people and the emergence of health insurance across all income sectors. Additionally, Indian medical service consumers have become more health conscious. The private sector is the driving force behind the modernization of the health sector – it represents 80% of the market and is investing in cutting-edge technology to meet the increasing demands of affluent patients.

The potential is all the greater as India spent just 1.3% of its GDP on public health care in 2014, and even including expenditure on private health care, the figure stands at only 4.3%. While government spending in the health sector was slashed in 2014 and attempts to introduce healthcare as a fundamental right have hit practical problems, the government is encouraging growth with reductions in import duties on medical equipment, higher depreciation on life-saving medical equipment (40%, up from 25%), and a number of other tax incentives.

According to the India Brand Equity Foundation (IBEF), the healthcare industry in India today is worth more than USD 65 billion, and there is a great dependency on imported medical technology with no strong expansion of local production expected in the foreseeable future. India imports approximately 80% of all required medical technology, and this is higher for technically sophisticated products.

In general the Indian sub-continent offers many opportunities especially in the medical device industry. The country has become one of the leading destinations for high-end diagnostic services with high capital investment in advanced diagnostic facilities. Another fast emerging sector is Telemedicine. In 2012, the market was valued at US$ 7.5 million, and is expected to grow to US$ 18.7 million by 2017. India’s competitive advantage also lies in the increased success rate of Indian companies in getting Abbreviated New Drug Application (ANDA) approvals.

The increase in both population and income ensure constantly rising demand for medical services in the foreseeable future with huge opportunities for investment in the healthcare infrastructure in both urban and rural areas of India.

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[1] valued at from USD 4.1 billion in 2011