The year gone by

The Indian healthcare sector is not just witnessing tremendous growth, it is also undergoing a remarkable transformation. 2023 was a good year for the MedTech and IVD industry, and for the hospitals and diagnostic service providers. The sector witnessed a historic surge in investments with over ₹34,000 crore inflows in 2023. Hospitals dominated with over 20 private equity deals amassing ₹32300 crore. Private equity investments jumped 9–10 percent, a substantial leap from the pre-Covid-19 era’s 2 percent and last year’s 5 percent.

The medical devices market in India is estimated at ₹142,200 crore in 2023, maintaining a steady CAGR of 15 percent over the last three years. FDI in MedTech in the first three quarters of the year 2023 is an impressive ₹3800 crore as against ₹3337 crore in the 12 months of 2022. The influx of new-generation technology has sparked the growth of start-ups and enterprises. From personalized medicine to predictive diagnostics, the journey ahead is marked by innovation and collaboration.

The hospital sector, estimated at ₹10.56 lakh crore in FY23, having reported a CAGR of about 11 percent during FY20 to FY23, is projected to sustain a robust CAGR of 12 percent over the upcoming three fiscal years, spanning from FY23 to FY26. The Indian diagnostic services market valued at ₹1.28 lakh crore in 2023 is forecasted to reach ₹3.75 lakh crore by 2032. The government push is expected to provide the requisite impetus. India’s public budgeted expenditure on healthcare, having touched 2.1 percent and 2.2 percent of GDP in FY22 and FY23 respectively, is poised for 2.5 percent in FY25.

The digital transformation of India’s healthcare industry has the potential to accelerate tenfold, from ₹21,600 crore in 2022 to ₹314,000 crore by 2030. This is being driven by rapid digitization, the proliferation of innovative healthtech platforms, partnerships between startups and established companies, and favorable funding environment for viable business models, supported by government initiatives.

The ubiquitous influence of AI in healthcare, IoMT connecting medical devices through wireless networks, 750 million smartphone users turning to telemedicine, online consultations with doctors, and 5G making a significant impact are together steering India to be more technologically innovative.

With 2023 providing a promising backdrop, the industry eagerly anticipates the opportunities and challenges that 2024 may bring. While the number of hospitals and medical colleges are being steadily increased every year, shortage of doctors and nurses, skilled technicians and pathologists, and faculty members is looming large. As we bid adieu to 2023, there remains an underlying anxiety. Although the world at large is adequately vaccinated, the Covid virus continues to evolve, change, and circulate in all countries globally, enforcing surveillance, sequencing, and a preparedness like never before!