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Growth rate of Health care sector may be 12-14% over next five years: ICRA

 

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ICRA expects annual revenue growth of 12-14 percent over the next five years in the health care sector, in line with the trend over the last three years. The health care sector is expected to grow by 12 to 14 percent annually over the next five years, due to increased medical tourism and penetration of health insurance, rating agency ICRA said.

"India has seen an increase in the influx of international patients, mainly from developing countries in South Asia, Africa and the Middle East." The most common treatments used by foreign patients visiting India are complex and valuable procedures. International patients have grown at a rate of more than 20 percent over the past three years, "said ICRA

"India has considerable advantages in terms of the cost of medical tourism, because treatments can be made at 60-90% of the cost of these procedures in the United States. The medical tourism sector has grown by more than 20% to continue growing at the same pace, doubling in size by 2021, " said ICRA Senior Vice-President and Group-Head, Corporate Ratings, K Ravichandran.

He added that the recently approved regulations on government-deregistered medical visas allowing for a 60-day stay (up from 30 days earlier) and a triple entry (against a single entry earlier) will further stimulate the industry. "This will create opportunities to hospital chains in India, particularly to large players in metros and tier-I cities," he added.

 

The key factor which deters patients from developed economies in America and Europe from visiting India is availability of affordable options closer to home, primarily in Mexico, Turkey, and Portugal, ICRA said.

Due to insufficient health care infrastructure and long waiting periods, few developing countries also support foreign travel for medical treatment India is a beneficiary of the support policies of these countries , Because the treatment costs here are one of the lowest, "said ICRA. It said Indian hospital chains, through direct marketing campaigns in source countries, forge tie-ups with local partners for travel and treatment services, enabling increased patient flow.

According to Shubham Jain, ICRA’s Vice-President and Sector Leader, "On the supply side, India currently faces a significant shortage of beds and limited government investments. This provides private sector players with an opportunity to step in to fill the gap."

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