Increasing Affluence and
Growing Health Awareness
According to the latest World Health
Organization ("WHO") statistics
available
4
, spending on healthcare in
India as a percentage of Gross Domestic
Product (''GDP") stands at 4% between
2010 – 2014. India’s spending on healthcare
is lower to the spending on healthcare
in countries such as United Kingdom
(9.1%) and United States (17.1%). In
Japan where life expectancy has increased
and with an aging population, healthcare
spending stands at 10.3% of GDP. In India,
it is anticipated that the rising per capita
income coupled with a growing and aging
population will see healthcare spending rise
from USD96.0 million to approximately
USD168.0 million by 2026
3
.
The Prevalence of Lifestyle
Related Diseases
With increasing urbanisation, India sees
a shift from communicable diseases to
lifestyle related diseases. In particular,
ailments related to cardiac, oncology and
diabetes contribute to rising individual
healthcare spending.
Increasing Penetration of
Health Insurance
Increasing literacy and awareness for
healthcare have also led to the penetration
of health insurance into the healthcare
market. Currently, only 17% of India’s
population has health insurance
5
.
Expenditure on health insurance is
expected to reach 8% of total healthcare
spending in 2015 in comparison to
6% from 2009 – 2010
3
. An increase in
penetration of health insurance will
lead to an increase in affordability of
medical services.
Medical Tourism
In the last decade, India has established
itself as a medical tourism hub, attracting
foreign medical tourists for its superior
quality healthcare at low treatment costs. In
addition, India’s position has strengthened
given the availability of word-class hospitals
and skilled medical professionals. The
inflow of medical tourists is expected to
exceed 3.2 million by 2015 in comparison
to 0.9 million in 2012
3
.
Government Initiatives for the
Healthcare Sector in India
At approximately 4% of GDP
4
, public
spending on healthcare in India is
among the lowest in both developed
and developing nations
6
. The government’s
low spending on public healthcare
has resulted in a disproportionately
high out-of-pocket spending, given only
17% of the population subscribes to
health insurance.
India’s ratio of 0.7 doctors and 1.5 nurses
per 1,000 people is below the global WHO
average of 2.5 doctors and nurses per 1,000
people
6
. There remains an inadequate supply
Market Review
and Outlook
RELIGARE HEALTH TRUST
10
