Private Equity Investment in Indian Healthcare Sector is Need of The Hour

The Indian healthcare system is already overburdened due to its aging population and growing chronic disease. The outbreak of the COVID-19 pandemic added an extra burden and exposed India's healthcare system to the world. Hence, India's struggling health system needs considerable attention from the government as well as private players. Government has to do more in terms of funding and fulfilling the demand for skilled labour.

Capital access is one of the major hurdles in the growth of the Indian healthcare sector. Today, at 1.26% of the GDP, the country's public expenditure on health continues to remain the lowest globally, making it seem like an uphill task to meet the target of 2.5% of the GDP by 2025. Along with strengthen India's infrastructure like building highways, power plants, and ensuring there is a roof over every Indian’s head, there is a need to focus on healthcare in the country.

The private sector has been playing an important role in developing the healthcare infrastructure in the country, with active participation from Private equity investment in India and an increase in FDI. However, to face India’s growing healthcare needs, both the public and private sectors need to come together to build infrastructure and the skill sets required to provide high-quality healthcare services. This means that traditional ways of healthcare funding will need to be supported by innovative modes of funding to improve healthcare investments.

The government will have to play an important role by creating an environment that attracts investments from domestic as well as international investors.

Some of the key factors that will shape healthcare delivery in the future:

·         Empowered and informed customers

·         Flexible and adaptive operating models

·         Nontraditional resources and partnerships

·         Growth and innovation mindset

·         Focus on accountability, integrity and sustainability

Sensing a huge opportunity in the healthcare sector due to the outbreak of the Covid-19 pandemic and its consequence, Equity investment in India is on the rise. To make sure that India provides quality healthcare services to its population, an additional investment of $245 billion is required by the year 2034.