India is projected to be the fastest-growing large emerging market in 2025, with healthcare spending expected to grow by 8.6% on the back of economic growth, opportunities for healthcare providers and government initiatives to increase access to healthcare.
Key view
- India shall be the fastest-growing major emerging market (EM) in 2025, driving growth in healthcare spending.
- These strong healthcare and economic growth prospects will create opportunities for healthcare providers in each the private and non-private sectors to expand their services within the face of growing demand.
- Despite India’s healthcare spending increasing, it stays low compared to other emerging markets, creating ongoing challenges due to underdeveloped infrastructure and labor shortages.
- The Government of India will proceed to prioritize the event of resources equivalent to hospitals and clinics, while strategic partnerships will help improve quality and accessibility.
India shall be the fastest-growing major emerging market (EM) in 2025, driving growth in healthcare spending. Our Country Risk team projects India’s real GDP growth to grow by 6.6% in 2025, outpacing the growth rate of other large emerging markets, including mainland China. In line with the rapidly growing economy, we expect healthcare spending to record high single-digit growth in 2025 at 8.6%, which is higher than most large emerging markets. This growth trajectory shall be maintained within the medium term, supported by stable economic growth in the approaching years. Only mainland China and Türkiye – where growth is hampered by a high-inflation environment – will see faster growth in health care spending over our forecast period. This strong macroeconomic environment is expected to drive investment in health care infrastructure and health workforce development, in addition to support the expansion of medical insurance coverage. India’s growing middle class together with rising demand for healthcare services will proceed to drive demand for high-quality medical products and healthcare.
These strong healthcare and economic growth prospects will create opportunities for healthcare providers in each the private and non-private sectors to expand their services within the face of growing demand. This can even create a possibility for medical device manufacturers to introduce revolutionary products equivalent to advanced diagnostics and minimally invasive surgical devices. We anticipate that public spending will exceed private spending, driven by government initiatives to increase access to health care and improve the standard of the general public health care system. However, with public healthcare infrastructure still underdeveloped in India and the growing demand for more specialized services, the private sector will retain the bulk and proceed to play a key role within the delivery of care. This highlights the essential role that each the private and non-private sectors will proceed to play in India’s healthcare system.
India’s economic expansion has set the stage for a major increase in health care spending by 2025. Despite being certainly one of the fastest growing economies on the earth, India devotes a comparatively low percentage of its GDP to health care, hovering around 3%. This underinvestment in health services creates challenges, especially in a rustic with a population of over 1.4 billion where the necessity for high-quality health care continues to grow.
However, because the economy continues to grow, there is growing awareness of the necessity to improve health care financing. Increased economic activity is expected to increase government revenues, which might then be directed toward health care. Policymakers are starting to prioritize health care as essential to sustainable economic development, recognizing that a healthier population translates right into a more productive workforce.
By 2025, strategic investments in health care infrastructure, insurance coverage and preventive services could significantly increase health care spending. Ultimately, aligning healthcare spending with economic growth will provide India’s growing population with the medical support it needs to support long-term well-being and economic stability.
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