Foreign Investment in Hospital Sector in India: Trends, Pattern and Issues

Shailender Kumar Hooda ()
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Shailender Kumar Hooda: Institute for Studies in Industrial Development, New Delhi

Working Papers from Institute for Studies in Industrial Development (ISID)

Abstract: This study examines the status of and trends in foreign investment inflow into the Indian hospital sector and highlights the emerging issues from 2000 to 2014, the era of liberalised foreign investment. During this period a significant number of multinational players focussed on the Indian hospital sector—expanding their presence through partnerships and investments in joint venture projects. Though foreign investment inflow to hospitals increased hundredfold during the period, an examination of selected major corporate hospitals of India, however, reflects that international investments constitute a small share within total financing; rather, it is the long-term domestic borrowing that dominates. Overall, foreign investments has largely been used in super-specialty and tertiary cares services, particularly in metropolitan cities, while investment for primary and secondary cares, clinical research, drug development, diagnostic services for rural area remained negligible. The study argues that private investment can play a complementary role in providing tertiary and speciality care services, particularly in the untapped hospital market, and it should not be considered as a substitute for public provisioning of healthcare services. The government will have to increase its healthcare spending manifold in order to provide cost-effective care to the general population across the country, including in the remotest areas.

Keywords: FDI; Hospital Sector; Foreign Financing; Super Speciality Hospital; India (search for similar items in EconPapers)
JEL-codes: I11 (search for similar items in EconPapers)
Pages: 26 pages
Date: 2015-04
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Citations: View citations in EconPapers (1)

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