For Sector To Take Off, Legislation And Infrastructure Need To Be In Place

Medical tourism can spin a dollar dream

It is tourism with a difference: healthcare or medical tourism. This is an area that Indian can have an edge in provided it is developed well. According to a McKinskey report, medical tourism can fetch up to $2bn. However, for the sector to take off, there needs to be a drastic improvement in infrastructure and better promotion of India as a medical destination. Ficci has chalked out areas on which both the government and the private sector need to work on if medical tourism is to take off in India.

Medical tourism is a growth area. A report by McKinsey last year said the trade could earn up market hospitals around $2bn by '12. Medical tourism according to the report has been growing at the rate of 15% over the last five years. " By 2012, if medical tourism was to touch 25% of revenues of private up-market players, then up to Rs 10,000 crore will be added to the revenues of these players." However,  for this promise to be fulfilled, certain measures need to be adopted. The broad areas of action are insurance, tax concessions, infrastructural facilities establishment of standards.

According to Preetha Reddy of Apollo Hospitals, India has a natural advantage of lower costs, which hasn't been capitalised on. "As a result countries like Thailand, Malaysia have got ahead." Insurance tops the list of policy issues for the area. Amit Mitra, Secretary general Ficci, said, "Our government needs to negotiate at WTO and the bilateral level so that health insurance cover in the original country should also cover medical care provided in India." Once this happens, a lot more of the business will come India's way, as expenses involved in much lower for the same level of care. Not only NRIs but also foreigner will look at India as a destination for medical treatment. The situation is not really untenable as most global insurance companies are in joint venture partnerships with Indian companies. So the agencies are in place to check on the facts.

The next impetus to the medical tourism business would be tax concessions, especially for allopathic treatment. Mr. Mitra suggest fiscal incentives in lieu of foreign currency flows." At present hospitals and nursing homes get concessions in lieu of number of beds and facilities, foreign currency flows need to be added to the list. These medical establishments could get cheaper or free land. Basically a connectivity needs to be established between fiscal incentives and foreign exchange inflow."

However, all this would not take the industry far unless accompanied by adequate infrastructure facilities, such as waste management, access to roads, attached hostels and guest housed where the family can stay and proper telecommunication network. " There is a need to increase the comfort level of those visiting India for healthcare purpose." A road-block that Preetha Reddy says is a big stumbling block. Most centres don't have proper flight connections. "Mumbai is the one centre that is relatively well connected. But Kolkata, Chennai also have good options for medical care but absence of proper airline connectivity makes them unattractive."

Economic Times dated 13/12/2003