Investment and Localisation Opportunities in Indian Medical Device Industry

India is ranked as the 4th largest medical device market in Asia, the industry was valued at 11.5 bln EUR in 2023 and is projected to grow at a CAGR of over 21%, reaching 46 bln EUR by 2030. The industry is experiencing a transformative phase, fuelled by robust healthcare infrastructure expansion, government initiatives, increasing per capita income, and increasing healthcare awareness. This growth is expected to lead the India’s emergence as a strategic hub for affordable and innovative healthcare solutions.

Below are details of key growth drivers:

Indian government’s “Ayushman Bharat” scheme focusing on availability and affordability of healthcare services across all sections of society, includes below components:
1. Health & Wellness Centres 150 thsd existing Sub Health Centres and Primary Health Centres to be upgraded to deliver Comprehensive Primary Healthcare (CPHC). These centers to equipped with relevant devices to conduct tests including Urine Dipstick, Blood count, Haemoglobin, Sickle Cell Test, Rapid Diagnostic Kits, Glucose, HIV, Tuberculosis, Syphilis, Hepatitis, Blood urea, Lipid Profile.
2. “Pradhan Mantri Jan Arogya Yojana” (insurance scheme): The introduction of health insurance coverage of up to 500 thsd INR per family annually has made healthcare significantly more affordable for over 100 million poor and vulnerable families.
3. Government e-Marketplace (GeM), which has streamlined public procurement processes, enabling hospitals to access critical medical devices at competitive rates
Beyond central government’s initiatives select states have announced initiatives to enhance the medical infrastructure across major district towns for e.g. The state of Uttar Pradesh has announced “One District, One Medical College Initiative”
Government’s push for local manufacturing through offering excellent manufacturing ecosystem: The Government of India has already initiated implementation of Production Linked Incentive Scheme for medical devices and support for setting up of 4 Medical devices Parks in the States of Himachal Pradesh, Madhya Pradesh, Tamil Nadu and Uttar Pradesh
End user related growth drivers and trends:
1. Home to world’s largest population
2. Increasing purchasing power and rising healthcare awareness
3. Increasing insurance penetration/ coverage across all age groups
4. The increasing burden of non-communicable diseases, which account for approximately 60% of all deaths in India, has particularly driven the demand for monitoring devices, diagnostic equipment, and therapeutic solutions tailored to long-term disease management

Summarizing the opportunities:

India as ‘De-Risking’ Destination: India is emerging as one of the 'preferred destinations’, as rising cost structures, trade war, COVID19 has triggered restructuring of global supply chain
Leveraging a low-cost manufacturing base, local setups—whether independent or through partnerships—cater to 'local-for-local' and export demand
‘Urban +’ Demand: Growing tier II/ III and rural focus with hospital chains penetrating the market, presents distribution network expansion opportunities to medical device companies
Shift To ‘High-Tech’: ‘Step-up’ opportunities to engineer and develop local, cost-effective ‘high-tech’ solutions (diagnostics imaging etc.) with new medical device regulations, 2023

To thrive in this dynamic environment, companies must evaluate possible expansion and investment opportunities in India. While transitioning from import/ sales model to localized production remains vital, EAC International Consulting provides specialized services for assessment market attractiveness, product benchmarking, local supplier evaluation, M&A guidance, location selection for manufacturing set-up and business plan development.

To learn more about how EAC can help your business succeed in the Indian chemical market, please connect with our team of experts: Ketan Jadhav and Rituraj Shailendra. We look forward to engaging with you.