India grapples with critical healthcare real estate deficit of 2 bn sq ft, reveals report
India has a shortage of healthcare space and beds to meet the needs of its growing population.
According to the Global Healthcare Report, India is currently facing a deficit of 2 billion square feet of healthcare space to meet the needs of its population of 1.42 billion. The World Health Organization (WHO) recommends a ratio of 3 beds per 1000 people, which means India needs an additional 2.4 million beds.
However, India's current bed to population ratio is only 1.3 per 1000, resulting in a deficit of 1.7 beds per 1000. This shortage is concerning given the rapid growth of India's healthcare market, which was estimated to be $372 billion in 2022, up significantly from $73 billion in 2012.
The Indian government has identified 582 investment opportunities in medical infrastructure, including hospitals, valued at $32 billion. The hospital industry accounts for 80% of the healthcare market in India.
Currently, India has an estimated 70,000 hospitals of which the private sector constitutes 63% of the total share, as per the data shared in the report.
To address this shortfall and improve healthcare access, India's National Healthcare Policy aims to increase government spending to 2.5% of GDP. The budgetary allocation to healthcare has already increased from 1.2% of GDP in FY 2014 to 2.1% in FY 2023.
Despite the deficit in healthcare infrastructure, India remains an attractive market for healthcare tourism. Between 2014-2019, the inflow of foreign tourist arrivals on medical visas grew at a compound annual growth rate (CAGR) of 30%, a report released on Thursday said.
Additionally, the cost of medical procedures in India is significantly lower than that of its Asian peeps, making it an appealing option for medical tourists.
In recognition of the potential in medical tourism, India ranked 10th out of 46 destinations worldwide in the Medical Tourism Index (2020-21). In 2022, the government launched the "Heal in India" initiative to further promote medical tourism in the country.
Shishir Baijal, Chairman and Managing Director, Knight Frank India said, “Post the pandemic, healthcare ranks amongst the mainstream avenues for investors looking for investments into long income generating assets. According to our Attitudes Survey, almost one-fourth of the Indian ultra-high net worth individuals had cited to invest in healthcare related assets in 2023.”
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First Published:23 Nov 2023, 04:54 PM IST
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