Indian healthcare market currently estimated at US$ 34.2 billion. The industry is expected to grow at 15% p.a., to reach US$79 billion by FY 2012. Private healthcare is estimated to be the largest component of the healthcare sector by 2012, expected to double to US$ 38 billion by 2012.

The Indian Healthcare market has grown  at a CAGR of 16%. Market is expected to grow to US$ 50.2 billion and US$ 78.6 billion by 2011 and 2016 respectively. The industry is fragmented with a large number of independent, privately run hospitals and healthcare centres. Market for tertiary care expected to grow at a faster rate, due to rise in complex in patient ailments such as heart diseases and cancer. The per capita healthcare expenditure in India grew by 9.3% between the years 1993-94 and 2001-02. Public spending on healthcare currently at 0.9% of GDP, expected to double to 2% of GDP.

Launched in April 2005 by Government of India, NRHM aims to fulfill the Government’s commitment to meet people’s aspirations for better health and access to healthcare services. NRHM’s ambitious goals include the training of 250,000 women volunteers designated as Accredited Social Health Activists (ASHAs) over the next three years across 18 states with weak rural health infrastructure. Revision and restructuring of the existing MBBS curriculum by including mandatory internship post MBBS keeping in mind the needs of NRHM

According to the recent National Rural Health Mission report nearly 8% PHC don’t have a doctor while nearly 39% were running without a lab technician and about 17.7% without a pharmacist. The PHCs are supposed to have one medical officer supported by paramedical staff.

According to Planning Commission figures India ’s CHCs require 3,910 surgeons. While only 2,372 are sanctioned, just 972 are in position and this is creating a vacancy of 1,381 posts for surgeons and a shortfall of 2,376 surgeons in CHCs. There are only 832 in position with 1,296 vacant posts and a shortfall of 2,516 physicians. Of the 3,910 pediatricians required only 1,951 posts are sanctioned of which just 837 are in position. There is a vacancy of 953 posts and a shortfall of 2,511 pediatricians

Major corporate hospital groups in India are making significant investments in setting up state-of-the-art Health Cities in major Indian Cities. Around 15-20 Health Cities are expected to come up in India in the next 5 years. Health Cities are looking at catering to larger populations by offering facilities such as hotels, residential facilities, and recreational facilities of spa, gym and even golf course.

Budget 2007-08: Healthcare Perspective

•   Increase in allocation for health and family welfare by 21.9% to US$ 3.73 billion reaffirms the Government’s commitment.

•   The AYUSH systems are also being mainstreamed into the health delivery system at all levels. Combined, they have been allocated US$ 29.3 million.

• Funds for the NRHM have also been increased from US$ 2 billion to US$ 2.42 billion.

• Reduction in import duty on medical equipment by 5% is expected to benefit high-end healthcare providers.

A recent FICCI-Ernst and Young (E&Y) report titled’ opportunities in Healthcare “Destination India” highlights several issues related to the healthcare sector.

Medical infrastructure forms the largest portion of the healthcare segment, and according to the report, the bed per thousand population ratio for India in 2006 stood at 1.03 as against an average 4.3 of comparable countries (like China, Korea and Thailand). The report points out that India is likely to reach a bed to thousand population ratio of 1.85 and, in a best case scenario, a ratio of 2 by 2012. Beds in excess of 1 million need to be added to reach a ratio of 1.85 per thousand at an investment of US$ 77.9 billion.

The report also observed that opportunity in medical equipment sector is growing at a faster pace. Currently the medical equipment industry is around US$ 2.17 billion and is growing at 15 per cent per year. It is estimated to reach US$ 4.97 billion by 2012. Since almost 65 per cent of the medical equipment is imported, it is a key area for forging partnerships across borders. In addition to this, engineering excellence, cost-effective labor, increasing emphasis on intellectual property rights and most importantly a fast growing domestic market makes India an ideal manufacturing base. This opportunity has attracted foreign medical equipment makers to float Indian subsidiaries -- 30 of them received import clearances in 2007 alone.

The growth in medical infrastructure will be supported by a demand for associated products and services, for example, the medical textiles industry which is projected to double to reach US$ 753 million by 2012.