The healthcare sector in India

Healthcare sector in India

Healthcare is one of India’s largest sectors. The sector is developing rapidly in medical equipment, medical infrastructure and telemedicine. Medical tourism is also growing rapidly.

Partly because the number of sick people (due to the large population) in India has increased significantly, the demand for medical products and services has grown. Increasing economic prosperity is driving the affordability of generic drugs in India.

The Indian government decided to invest heavily in the sector in 2020 and increased the healthcare budget with billions in the following years. Healthcare spending has increased from 1.13% of GDP in 2014-15 to 1.84% of GDP in 2022-23.

Since 2020, the Indian government has allowed 100% Foreign Direct Investment (FDI) in the medical device sector, providing opportunities for foreign companies.

With the large, available pool of highly skilled medical professionals in India, the industry is expected to generate as much as 774 billion dollars in revenue by 2030.

Snapshot of the healthcare sector in India

India’s healthcare sector continued its healthy growth in 2022, reaching a value of 372 billion dollars, driven by both the private and government sector.
The healthcare sector is expected to reach a value of 610 billion dollars by 2026.
As of 2024, India’s healthcare sector is one of the largest employers in India, with a total of 7.5 million employees.
The healthcare IT sector was valued at 4.4 billion dollars in 2023 and is expected to reach 9.9 billion dollars by 2029.
Medical tourism in India is growing at 22-25 percent per year due to the relatively low cost of medical care. It contributes more than 2 billion dollars to the Indian economy.
The Indian hospital market was valued at 99 billion dollars in 2023 and is expected to grow at a CAGR of 8% from 2024 to 2032, to reach an estimated value of 193.6 billion dollars by 2032.
The Indian telemedicine market was valued at 1.1 billion dollars in 2022 and is expected to grow at a CAGR of 21.2% to reach 5.2 billion dollars by 2030.

Our expert

Deepmala Datta Head of Business Development

Growth drivers of India's healthcare sector

By the end of 2030, India is expected to be among the top three health care markets.
The government of India plans to increase public health spending to 2.5% of the country’s GDP by 2025.
There is increasing demand for AI-based technologies. India is the world’s go-to hub for AI-services.
The medical device sector is growing as fast as the growth in the number of patients.
Further increase in population, rising income and increasing life expectancy are major growth factors for this sector.
Advances in telemedicine, virtual assistants and data analytics are expected to create 3 million new tech jobs.