Healthcare, a crucial sector in any country, has seen dramatic changes in the past two years. With 80% of healthcare systems planning to increase investment in digital healthcare tools in the next five years, technology and innovation are at the forefront. India’s healthcare system, comprising hospitals, medical devices, clinical trials, and various other components, plays a significant role in the country’s economy and welfare.
The Current State of the Indian Healthcare Sector
India’s healthcare sector is a mix of public and private entities. The government runs primary healthcare centres in rural areas and limited secondary and tertiary care institutions in cities. Conversely, the private sector oversees secondary, tertiary, and quaternary care institutions primarily located in metro, tier-I, and tier-II cities.
The market statistics for the Indian healthcare sector show impressive growth. Expected to rise three-fold, the sector aims to reach USD 372 billion in 2022 from USD 110 billion in 2016, reflecting a Compound Annual Growth Rate (CAGR) of 22%. In FY21, health insurance companies’ gross direct premium income grew 13.3% YoY to Rs. 58,572.46 crore (USD 7.9 billion). The Indian medical tourism market is expected to reach USD 13.42 billion by 2026.
Challenges Faced by the Health Sector in India
Despite progress, the health sector in India faces multiple challenges. Access to basic healthcare services remains inadequate due to a shortage of medical professionals, insufficient research funding, and low quality assurance. India’s public expenditure on healthcare is only 2.1% of its GDP, compared to countries like Japan, Canada and France, which spend approximately 10% of their GDP on public healthcare. Preventive care is undervalued, despite proven benefits, and little attention is given to R&D and new technology-led projects. Policymaking is crucial for the provision of effective healthcare services. In India, supply rather than demand is the issue.
Potential of the Indian Healthcare Sector
India’s healthcare sector boasts a large and well-trained pool of medical professionals, offering cost-competitive care compared to Asian and western countries, with surgery costs approximately one-tenth of that in the US or Western Europe. Other contributing factors for potential growth include a robust pharma and medical supply chain, 750 million plus smartphone users, a thriving start-up culture, and easy access to Venture Capital (VC) funding. The sector has generated 2.7 million additional jobs in India between 2017-22, employing a total of 4.7 million people as of 2021.
Government Initiatives for the Healthcare Sector
The government’s commitment to improving the health sector is evident through various initiatives such as the National Health Mission, Ayushman Bharat, Pradhan Mantri Jan Arogya Yojana (AB-PMJAY), National Medical Commission, PM National Dialysis Programme, Janani Shishu Suraksha Karyakram (JSSK), and Rashtriya Bal Swasthya Karyakram (RBSK).
The Way Forward for the Healthcare Sector
Improving public hospital infrastructure should be a priority, given their importance to India’s large population. Encouraging private hospitals and further incorporating the private sector is also vital. The induction of more medical personnel is needed to increase the sector’s capabilities and efficiency. The use of medical devices, mobile health apps and wearables in hospitals and clinics could improve the system’s functionality. All these steps could help alleviate the challenges faced by the healthcare sector in India.
Appendix: UPSC Civil Services Examination, Previous Year Questions (PYQs)
Understanding the healthcare sector and its challenges is also important for the UPSC Civil Services Examination. Candidates should study the objectives of various government health initiatives and analyze their impact on the healthcare structure and sustainable development.
