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India's healthcare market may see threefold rise as its size in value terms is likely to reach $372 billion (bn) by 2022 from the level of $110 bn as of 2016 thereby clocking a compounded annual growth rate (CAGR) of 22 per cent, according to an ASSOCHAM-RNCOS joint paper.
Growing incidence of lifestyle diseases, rising demand for affordable healthcare delivery systems due to increasing healthcare costs, technological advancements, emergence of telemedicine, rapid health insurance penetration, mergers and acquisitions helping to reach untapped markets and government initiatives like e-health together with tax benefits, incentives and a host of upcoming regulatory policies are driving healthcare market in India, noted a paper on 'Indian Healthcare Sector-An overview,' jointly prepared by ASSOCHAM and research firm RNCOS.
The study stated that factors like growing geriatric population, uptick in medical tourism and gradual decline in cost of medical services will drive medical devices market in India which was valued at $4 bn as of 2016 and is likely to cross $11 bn mark by 2022 thereby registering a CAGR of 15 per cent.
It however noted that imports make up about 75 per cent of Indian medical devices market.
The paper noted that Goods and Services Tax (GST) will have a positive impact on Indian healthcare market, particularly the pharmaceutical sector.
GST would not only streamline taxation structure but lead to ease of doing business by minimising cascading effect of many taxes applied to a product, rationalise supply chain, enable flow of seamless tax credit, lower manufacturing cost, reduce cost of technology and make healthcare affordable.
Generic drugs account for about 70 per cent of India's $20 bn worth pharmaceutical market.
Of these, anti-infectives occupy the largest share of 16 per cent followed by cardiovascular (13 per cent), gastro-intestinal (11 per cent), respiratory (nine per cent), vitamins/minerals (eight per cent) analgesic (seven per cent), anti diabetic (seven per cent) and others (29 per cent).
Increasing expenditure on research and development (R&D), rising collaborations between Indian and foreign companies, reduction in product approval time and other such factors are driving the growth of Indian pharmaceutical market, highlighted the paper.
Indian pharmaceutical market is third largest globally in terms of volume and 13th largest in terms of value.
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