India’s Medical Device Sector Attracts Global Investment Amidst Industry Growth
India’s medical device sector is experiencing robust growth, attracting significant global investments and positioning itself as a pivotal player in the global healthcare landscape.
Market Growth and Projections:
- Current Valuation: As of 2020, the Indian medical devices market was valued at approximately $11 billion, contributing about 1.5% to the global market.
- Future Projections: The sector is expected to reach $50 billion by 2025, driven by a compound annual growth rate (CAGR) of 15%.
Government Initiatives and Policies:
- Production Linked Incentive (PLI) Scheme: The Indian government has introduced financial incentives worth $400 million to boost domestic manufacturing of medical devices.
- Medical Devices Parks: Development of parks in states like Himachal Pradesh, Uttar Pradesh, Madhya Pradesh, and Tamil Nadu aims to create a robust manufacturing ecosystem.
- National Medical Devices Policy 2023: This policy focuses on strengthening the sector through regulatory streamlining, infrastructure development, and encouraging innovation.
Foreign Direct Investment (FDI) Trends:
- Increased Inflows: FDI in the medical device sector reached $3.4 million in the first three quarters of FY23, up from $1.9 million in FY22, marking the highest since FY17.
- Major Investments:
- EQT’s Commitment: Swedish private equity firm EQT invested around $6 billion in India over 18 months, focusing on healthcare sectors, including acquisitions like Indira IVF and AIG Hospitals.
- Temasek’s Strategy: Singapore’s Temasek plans to invest up to $10 billion in India over the next three years, targeting healthcare among other sectors.
Export Potential:
- Growth Trajectory: India’s medical device exports have been growing at a CAGR of 9-11% over the past five years, with expectations to reach approximately $10 billion by 2025.
- Global Market Share: Projections indicate that India’s share in the global MedTech market could increase from 1.6% to 10-12% over the next 25 years.
