Competition Related Issues In Health Sectors

The Indian healthcare sector is estimated to reach US$ 100 billion by 2015, growing 20 per cent year-on-year (y-o-y), as per rating agency Fitch. The industry is expected to touch US$ 280 billion by 2020, on the back of increasing demand for specialised and quality healthcare facilities. India is the most competitive destination with advantages of lower cost and sophisticated treatments, highlighted the RNCOS report titled 'Indian Healthcare - New Avenues for Growth'. The report further elaborates that several key trends are backing the growth of India's healthcare sector. "India is a very important market for many reasons. The government continues to invest in healthcare. We see that healthcare is expanding across the country. There is a growth opportunity and we continue to invest very much in India. There is so much innovation in India," highlighted Mr Adam H Schechter, Executive Vice President and President, Global Human Health Division, Merck. Market Size Private equity (PE) and venture capital (VC) investments in the healthcare industry in India are increasing rapidly. In 2012, the industry absorbed US$ 1.2 billion across 48 deals, according to research firm Venture Intelligence. The hospital and diagnostic centre in India has attracted foreign direct investment (FDI) worth US$ 1,542.35 million, while drugs & pharmaceutical and medical & surgical appliances industry has registered FDI worth US$ 9,783.31 million and US$ 584.14 million, respectively during April 2000 to December 2012, according to data provided by Department of Industrial Policy and Promotion (DIPP). Indian pharmaceutical industry is projected to show double-digit growth in near future owing to a rise in pharmaceutical outsourcing and rising investments by multinational companies, as per RNCOS report titled 'Indian Pharma Sector Forecast 2014'.The report highlighted that focus of the industry will shift towards capitalising the potential of tier-III and rural areas. Emerging sectors, such as bio-generics and pharma packaging will also pave way for the pharmaceutical market to continue its upward trend during the forecast period (FY 2012- FY 2014). Trends and Investments Healthcare providers in India plan to spend Rs 5,700 crore (US$ 1.05 billion) on IT products and services in 2013, a 7 per cent rise over 2012 revenues worth Rs 5,300 crore (US$ 981.50 million), according to a report by Gartner. It is expected to grow to 3.9 per cent to reach Rs 1,720 crore (US$ 318.52 million) in 2013, with most of this growth coming from enterprise communication equipment. Further, the hospital services market, which represents one of the most important segments of the Indian healthcare industry, is expected to be worth US$ 81.2 billion by 2015, as per a RNCOS report. Public and Private Hospital Facilities in India India is an exception as it has one of the highest private spending on healthcare. With most of the Indian population still below the poverty line public facilities are largely to cater to this segment however in the urban and sub-urban areas private healthcare facilities are preferred. With rising income levels and exposure to international standards/ quality has raised the demand for quality private healthcare facilities. The private health sector consists of the 'not-for-profit' and the 'for-profit' health sectors. The not-for-profit health sector includes various health services provided by Non Government Organisations (NGO's), charitable institutions, missions, trusts, etc.

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