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'Health care delivery seeing rapid growth in north India'

The north has begun seeing proliferation of speciality hospitals and healthcare centres, with major players

BS Reporter  |  New Delhi 

In northern India, the health care delivery sector, including hospitals and diagnostic services, is growing rapidly.

According to Bridging the Divide for a Healthy India, a report jointly published by Grant Thornton and the Confederation of Indian Industry, the north has begun seeing proliferation of speciality hospitals and healthcare centres, with major players such as Fortis, Apollo, Medanta and Metropolis investing in this space.

"Leveraging improved technology and infrastructure of medical institutions, northern India is witnessing a steady rise in medical tourism. A number of regions, including the Delhi National Capital Region, Chandigarh, Amritsar, Mohali and surrounding areas have been attracting patients from abroad," the report said.

While hospital chains were trying models such as tertiary care, secondary care, health city, hub-and-spoke and single-speciality hospitals, the report said those with a capacity of 100-500 beds led the pack. It added chains of single-speciality hospitals and diagnostics businesses would continue to attract interest from PE funds, as well as strategic players.

"Eye care, dental care, maternity pediatrics, orthopedic surgery, pathology, low-end imaging, etc, are areas in which we expect to see significant transaction activity in 2013 and beyond," the report said.

Since 2010, the healthcare sector saw a significant number of PE deals, including Temasek Holdings' investment in Max India, Sequoia Capital's investment in Moolchand Healthcare and Matrix Partners India's investment in Mewar Orthopedic.

However, foreign investment inflow into the healthcare delivery sector is low, compared to other industry segments. Foreign direct investment in hospitals and diagnostic centres in the period between April 2000 and December 2012 is pegged at $1.54 billion (Rs 8,316 crore), compared with $9.78 billion (Rs 52,812 crore) in pharmaceuticals and $584.14 million (Rs 3,154 crore) in medical and surgical appliances.

By 2015, the public sector's share in healthcare delivery services is estimated at 19 per cent, against 34 per cent in 2005. Investment by the private sector, however, has increased.

The report recommends the public-private partnership mode to address concerns of infrastructure and a national task force to promote and define standards for the adoption of telemedicine.

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First Published: Thu, May 02 2013. 00:10 IST