Boom in

Healthcare
sector
The pandemic may have pushed several economies and businesses to the brink, but what stood strong at such
a crucial period was India pharma.
Of India’s estimated 237 billionaires, 40 made their fortunes from pharmaceutical companies, according to
the latest Hurun India Rich List.
The pandemic proved We can make stuff that the world needs, very quickly, at short notice.
To the investors
India has always been the “Apple of the eye” for an investor by virtue of its huge population, diverse
geography, mixed cultures and immense potential.
Healthcare in India was always treated as a second cousin when it came to prioritizing resources, but with the
advent of the COVID-19 pandemic, India experienced the disadvantage it had put itself in, by not prioritizing
healthcare as the virus has highlighted the lack of readiness of the country to fight and overcome new viruses.
Country Opinion.
Country realised that this is a major sector for which if sufficient resources are not provided, then it has the
potential to bring the entire country to its knees & can devastate the economy. The current state of this sector
and the scope of improvements have been highlighted by domain experts periodically.
The Indian healthcare sector is one of the fastest growing sectors with high contribution not only in terms of
revenue, but also employment. It includes hospitals, medical devices, health insurance, telemedicine, clinical
trials, medical tourism, and medical equipment. Healthcare has been at the epicentre for the past 24 months.
This shift of focus to Healthcare infrastructure led not only the country but the world to sit up and realise that
there is a massive opportunity beyond the Pharmaceutic sector for the country.
According to the department of industrial policy and promotion (DIPP), the hospital and Diagnostics sector
has attracted FDI of 6.8billion from April 2000 to June 2020.

The huge investment opportunities in Healthcare has been highlighted by NITI Aayog in one of its reports it
published in 2021. The key points emphasized upon in the report were:
* The healthcare market size is expected to reach $372Bn by 2022.This growth is driven by the rising income
levels, ageing population, increasing healthcare awareness, growing health insurance penetration, increasing
government's focus on providing universal healthcare and the growing burden of the noncommunicable
diseases (NCDs). Along with these drivers, India's unique value proposition in the form of low costs,
availability of advanced technologies and skilled workforce are further driving the medical tourism to the
country.
* The current market size for pharmaceuticals in India is $41 billion, which is expected to reach $130 billion
by 2030. Indian pharmaceuticals have a share of 85 per cent while Global Pharmaceuticals have managed to
capture a share of only 15 per cent in India.
* India’s biotechnology market is expected to grow at an average growth rate of around 30% per year to reach
$100 billion by 2025.
* India already contributes over 20 per cent by value to the global generics market, with Indian products
contributing over 40 per cent (by volume) of US drugs Market.
* The hospital industry in India, accounting for 80% of the total healthcare market, is witnessing a huge
investor demand from both global as well as domestic investors. The hospital industry is expected to reach
$132 bn by 2023 from $61.8 bn in 2017; growing at a CAGR of 16-17%.
* The diagnostics industry is expected to grow at a CAGR of 20.4 per cent and is set to reach $32 Bn by 2022.
* The medical tourism sector clocked a consistent 18% CAGR during the prepandemic phase. The Indian
Medical Tourism market was expected to grow from its size of $3 bn in 2016 to $9 bn by 2020, which got
delayed by the Govt. 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
* There is a 370 per cent increase in health expenditure from 2000 to 2014.
* The digital healthcare market in India was valued at INR 116.61 Bn in 2018, and is estimated to reach INR
485.43 Bn by 2024, expanding at a compound annual growth rate (CAGR) of ~27.41% during the 2019-2024
period. Over the next 10 years, National Digital Health Blueprint can unlock the incremental economic value
of over $200 bn for the healthcare industry in India.
* The government has allowed 100 per cent FDI for all greenfield projects under the automatic route. For
investments in brownfield projects, up to 100% FDI is permitted under the government route.
* India’s comprehensive investment in Medical Education: INR 17,691.08 Cr invested in 157 new approved
Medical Colleges since 2014
* Health insurance contributes 20% to the non-life insurance business, making it the 2nd largest portfolio. The
gross direct premium income underwritten by health insurance grew 17.16% year-on-year to reach $6.87 bn
in FY20 and has clocked a growth of 28.8% in the F.Y. 2021-22.
* The Telemedicine market is the maximum potential eHealth segment in India, which is expected to touch
$5.4 Bn by 2025, growing at a compound annual growth rate (CAGR) of 31%.
* Emerging trends are telemedicine, artificial intelligence, mobile and wearable devices, and robotic surgeries
along with Internet of Things, also offer numerous avenues for investment.