GeneralFuture of Medical Equipment Manufacturers in India

1. Introduction

The medical equipment manufacturing sector has grown tremendously in the past few decades. There is an enormous gap in the current demand and supply of medical equipments in India and this has provided an opportunity for manufacturers of medical equipments in India. At present times, many medical equipment manufacturers are keenly following this huge under penetration of medical equipments in India as a tremendous growth opportunity. The present developmental parameters indicate even higher growth potential in near future. The Indian government also has undergone various reforms as well to help the market of medical equipment manufacturing by regulating it to become more transparent and by promoting Indian investments in the medical equipment manufacturing sector. The Indian medical equipment manufacturing market has increased from USD 2.8 billion in 2007 to USD 3.5 billion in 2017 at CAGR of 14.3%3. This accounts for 1.9% of the global medical equipment manufacturing market.  The Indian medical equipment manufacturing contributes to 5% of the Indian healthcare market which is at USD 9.7 billion.  The estimate suggests that the market for Indian medical equipment manufacturers will grow to USD 9.13 billion in 2024 at CAGR of 18%. Also, Indian medical equipment manufacturing market is one of the top 25 global markets and the 6th largest medical equipment manufacturing in Asia.

2. Understanding the Indian medical equipment market

The Indian medical equipment market is divided mainly into many divisions. The major potential areas in India include general medical equipments, orthopedic implants, ophthalmic instruments, diagnostic imaging, prosthetic devices, patient aids, consumables, dental products and IV diagnostics among others. Diagnostics imaging is the major area constituting 28% of the medical equipment market, with yearly sales of USD 60 billion in 2017. The second major area is IV Diagnostics with 26% share at USD 54.5 billion. Among others dental products include dental implants, dental chairs and equipment account for share of USD 13.68 billion. Maharashtra and Andhra Pradesh are the largest medical equipment manufacturing market at 43% of the total Indian sale. Tamil Nadu and Telangana are the second largest medical equipment manufacturing market at 33% of the total medical equipment manufacturing sale. Delhi and Haryana are the third largest market at 25% of the total medical equipment manufacturing sale. It is estimated that 55-69% of the total Indian medical equipment market is driven by 15 Indian medical equipment manufacturing companies only.

3. Factors impacting the future demand of medical equipements in India

The various parameters that will drive the demand of medical equipment manufacturing in India include : a) Population increase: Population in India in 2011 was 1213 million in 2013 which is increasing at a rate of 1.7 percent annually and will reach  to 1375 million in 2025 . The increasing population will tremendously increase the demand for medical services and this will ultimately increase the demand for medical equipment manufacturing in India. b)  Increase of elderly population:  Out of the total Indian population in 2011, the aged population was 7.3% and is expected to rise to 8% by 2025. The rising increase of aged population will increase the demand for improved medical services and medical equipment manufacturing. c)  Increase in the rise of chronic ailments and diseases: Diseases like diabetes, cancer and cardio vascular diseases among others are expected to have a share of 77% of India’s active diseases by 2025, compared to 41% in 2009. The long term diseases will rise the demand for better medical services with advanced medical equipment technology and ultimately leading to increase in medical equipment manufacturing in India. d) Rising medical insurance of people: The Indian medical insurance had a tremendous hike in the last few decades. The medical health insurance market was at USD 3.4 billion in FY13 and grew at an enormous CAGR of 20 percent till 2018. The Indian medical health insurance market is expected to rise over USD 8 billion in FY 2023, and near to USD 24 billion in FY 2027.

4. Future Regulatory Scenarios for medical equipment manufacturers

The Indian government has already taken various steps to ensure that medical equipment manufacturers get enough appreciation. The Government of India has formed a team on medical equipments and started the journey of working on its various advices such as differentiating medical equipments from drugs. Some of the tasks like Make in India and development of medical equipments parks in South Indian states like Andhra Pradesh will further lead to the development of Indian medical manufacturing sector, which would eventually be beneficial for the manufacturers. The Indian government has planned to set up a National Medical Equipments body to establish a single mechanism and framework for the local medical equipment manufacturing industry and incentives like beneficial duty structure, least duty on import of raw materials, very less subsidy and minimum power costs are some of them. The government is setting up centers of excellence for providing a framework for product development and proper validation. The government is separately planning to control the prices for equipments like ophthalmic instruments, orthopedic implants and general medical equipments by introduction of new policies. Medical equipment manufacturing is among the 25 focused areas selected by the government as a part of their future developmental policies. Recently, government of Andhra Pradesh established a Andhra Pradesh MedTech Zone (AMTZ), and it has already received started receiving funding by the government and is Asia’s first dedicated medical equipment manufacturing park, located at Visakhapatnam. The park will provide modern facilities such as testing centers, 100 independent manufacturing units, specialized laboratories and warehousing among others. Also, in the future plans of the government is the establishment of medical equipment testing lab in Gujarat with the focus on biomaterials and orthopedic implants and the lab at Noida that will focus on testing of electrical and electronic medical equipments.  Thus, the Indian government is trying to tremendously boost the capabilities of Indian medical equipment manufacturers that will help them to limit the deficiencies in their products and to enhance their product value in the Indian healthcare market.

5. Advantages of medical equipment manufacturing in India

The advantages of medical equipment manufacturing in India include : a) Lower costs of raw materials and labour than other manufacturing hubs. b) Easy supply chain across various regions of India c) Favorable trade policies in India. d) Strong policies for Intellectual property rights. e) Strong policies for data security f) Skillful  human resources available in India g) Very less cost of operation in India. h) Production associated benefits available in India i) Robust ecosystem to rise the scale of the production in India.

6. Conclusion

Recent health care crisis have created an enormous requirement for quality medical equipment manufacturing in India. In the near future, there will be an enormous scope of medical equipment manufacturing in India with rising med-tech startups and companies. Also, the various incentives and easy ground will help the manufacturers in establishing deep connections with the existing healthcare market in India. Thus, in future the minimum expense of production of medical equipments and maintenance of quality standards will mark the rise of India as the most desirable medical equipment manufacturing hub, which will eventually be beneficial to medical equipment manufacturers in India as well.

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