Technology affinity and growing health awareness are your opportunities as a European company on the Indian market
Indian health initiative
The Indian government plans to invest a significant amount in medical infrastructure by 2025. It has set itself the goal of increasing public health spending to around 3 percent of GDP, a significant increase from current spending of around 2 percent. This investment program is complemented by the "Ayushman Bharat Health Infrastructure Mission" (ABHIM), which will provide a further USD 2026 billion by 8. The public health system is to be expanded across the board - including by setting up new health centers and specialized facilities for secondary and tertiary health care. In addition, the aim is to increase the level of medical education, which is to be achieved by establishing new universities and increasing support for medical research institutes. Emergency management infrastructures and improving capacities for combating pandemics and health crises will also be part of this health offensive.
growth market medical technology
The exact growth forecasts for the medical technology market vary. The Indian government is currently calculating an increase in sales of around 9% in the coming year. By 2026, the medical technology sector is expected to reach a market volume of USD 372 billion (according to the India Brand Equity Foundation of the Indian government, IBEF).
Just like the public sector, the private health sector is also on the rise. At present, it accounts for 60 percent of the hospital beds in the approximately 70.000 hospitals in India. Here, too, bed capacity is expected to increase significantly in the next few years.
Two-class medicine
As you can imagine, there is a two-tier healthcare system in India: the public healthcare system is understaffed and poorly equipped, while the private sector offers the highest quality standards at high prices. Medical standards in urban centers and rural areas are similar. There is a significant need to catch up in healthcare, particularly outside of the major cities. There is a lack of infrastructure and resources.
High demand for import of modern medical technology from abroad
With over 1,4 billion inhabitants, India has a young and rapidly growing population – tech-savvy, with increasing health awareness and a desire for better medical care.
Digital health – that is, the areas of digital fitness, well-being and digital treatment options – is booming. Around 752 million Indians will use the Internet in 2024, mostly from mobile devices, and many of them own smartwatches or other devices.
In the private healthcare sector, the greatest demand for the highest quality in the high-end sector naturally exists, both in clinics and outside of hospitals. Local Indian production cannot currently satisfy such demand. India is therefore dependent on imports of modern medical technologies and equipment from abroad, particularly in the area of diagnostic and surgical equipment (e.g. imaging diagnostic equipment, cardiological equipment, orthopedic equipment).
But there is also a market for used devices. Especially outside of the big cities, purchasing a new device is often not economical or there are not enough financial means to purchase the latest technology.
digitization of the Indian healthcare system
With the introduction of the Ayushman Bharat Health Account (ABHA) and the creation of ABHA IDs, the government is further driving the digitization of healthcare. A national platform for telemedicine (eSanjeevani) already exists, which can reduce the gap in healthcare, especially in remote rural and hard-to-reach areas. By 2025, this market is expected to grow to around USD 5,4 billion, which corresponds to a CAGR of 31%.
Challenges for foreign companies
In addition to the cultural challenges that India always poses for European companies, there are also regulatory hurdles that must be overcome. Successful market access requires comprehensive knowledge of local regulations and standards [seee BIS Quality Control Orders and the “CDSCO” (Central Drugs Standard Control Organization)]. In addition, the Indian market is highly price-sensitive. Local manufacturers often offer cheaper alternatives, which intensifies competition. Industry experts also fear that price caps will be set for more products than before, which will disadvantage foreign manufacturers who cannot produce locally at low cost.
Conclusion
The Indian medical technology market offers enormous growth opportunities for you as a European company, especially in the area of innovative technologies and digital solutions. To be successful, however, you should conduct careful market analyses and, if necessary, check whether strategic partnerships are possible. With the right approach, you can not only benefit from India's dependence on imports, but also make a valuable contribution to improving healthcare in this dynamic country.
Are you interested in your individual market opportunities in India? We regularly organize individual market exploration trips or delegation trips for companies [see blog article Market research trip] Please feel free to talk to us.
