Medical equipment sales in India continue to reach new heights, driven by increased demand for healthcare services. This demand is driven in turn by rising middle-class incomes and increased health consciousness among India’s people. In response, the public healthcare sector is improving the quality and scope of its services, and private hospitals are upgrading their facilities to remain competitive. These trends bode well for foreign medical equipment manufacturers, as imported medical products are often favored over domestic products by both medical providers and patients. Currently, imported medical equipment represents 61 percent of the market in India.
Foreign medical device companies are also helped by further decreases in protectionism of medical equipment imports to India. Liberal import policies are not new in India. That said, import duties for medical equipment are expected to continue to decline in the coming years, further opening the market to imports. From 1999-2000, the value of medical device imports to India rose from $810 million to $930 million and is estimated to have hit $1067 million in 2001 (final figures are not yet available). Notwithstanding the current global economic slowdown, we project these figures to rise further in 2002, though perhaps at a slower rate.
Medical equipment demand will be further enhanced by the central government’s recent decision to allow privatization of the insurance sector, including health insurance. Improved healthcare coverage will incline more Indians to get additional medical tests done. Medical providers are also expected to be more concerned with quality, due to insurance monitoring. Both these factors will lead to a greater demand for medical equipment. The health insurance market is expected to grow from the current $66 million (2001) to $377 million by 2005, according to the Confederation of Indian Industry (CII).