Silver lining on COVID cloud: How India’s Medtech industry is growing

The pandemic has given a much-needed boost to the sector that may help India to cut reliance on imports.

September 6, 2021

The pandemic has led the medical devices industry to adapt to meet unprecedented healthcare needs.

The Indian medtech sector has a potential to reach US$50 billion by 2025 from US$11 billion in 2020.

During 2015-2020, the sector got $600 million in FDI, mainly from the US, Singapore, Japan and Europe.

Instruments, consumables and implants attracted the most investments.

Unprecedented times offer unprecedented opportunities. And this is exactly what the medical-technology, or medtech, industry in India has lapped up with both hands as the world continues to grapple with the coronavirus. The pandemic has brought the Indian medtech industry to the centre stage so much so that the sector has a potential to reach US$50 billion by 2025, according to Dr Jitendra Singh, Minister of State (Independent Charge) of the Ministry of Science and Technology, and Earth Sciences. The sector’s size was around US$11 billion in 2020.

Speaking about the medical devices industry, which has been recognised as a sunshine sector by the government, Singh said the government will collaborate with the stakeholders in developing medical technology. Singh was speaking at the 13th edition of the Global MedTech Summit organised by the Confederation of Indian Industry (CII). 

Push and pull

The ongoing pandemic has led the medical devices industry to quickly adapt to the rising healthcare needs with unparalleled demand for products such as masks, gloves, diagnostic test kits and personal protective equipment (PPE). The industry has been able to respond to the new demands and quickly implement innovative changes. 

As a result, foreign investment in the sector almost doubled in 2020 as compared to the previous year, Ashok Patel, founder and CEO of Max Ventilator, wrote in a recent article. Experts in the field say it also goes on to prove the existing strength of the medical device sector as well as the trust that foreign players place on the Indian economy. 

In the past five years, India’s medical devices sector has received US$600 million in foreign investments, mostly from countries such as the United States, Singapore, Japan and Europe. The instruments, consumables and implants segments attracted the most investments. Last year, Japanese investors expressed interest in setting up a manufacturing base for in vitro diagnostic devices and medical electronics in India.

In fact, India is seeking 200 joint ventures with international investors worth US$2 billion and above and with 50 MNCs for the same amount, as part of the programme, according to Patel. This is in addition to 1,200 technical collaborations worth US$5.7 billion with Indian investors. Moreover, several worldwide medtech businesses also brought Covid-specific product designs and specifications from the US into India to collaborate with Indian manufacturers.

India is the fourth-largest market of medical devices in Asia and among the top 20 markets in the world

All that has been possible because the regulatory climate for the medical device industry has become more investor-friendly in recent years. The government has allowed 100% foreign direct investment for both greenfield and brownfield projects through the automatic route into this sector. In addition, the government has identified medical devices as a priority sector under the flagship ‘Make in India’ programme. The Production-Linked Incentive (PLI) scheme is promoting domestic manufacturing of medical devices and make India a global hub.

According to Dr Jitendra Singh, India’s healthcare industry has made several advances during the 70 years since Independence. “We are among the world leaders in medicare and sometimes new technologies are applied here even before these are rolled out in the West,” said Dr Singh. This, he added, is despite the fact that most medical technologies are not indigenous and we are still dependent on as much as 85% imported technologies. 

“One reason being the healthcare sector has never been given priority here in India, neither social nor cultural, owing to legacy issues besides economic constraints,” he said. He added that Covid-19 has served to give a push to indigenous technologies such as the Council of Scientific and Industrial Research manufacturing ventilators, the Department of Biotechnology getting involved in vaccine production, and the Indian Space Research Organisation in liquid oxygen.

Singh also said that instead of ministry or department-wise approvals, India should go for theme-based projects involving the private sector. “Indigenous medical technologies will help reduce dependence on imports and for this the government, private sector, corporates and scientists, all will have to come together and pool their resources.”


India is the fourth-largest market of medical devices in Asia and among the top 20 markets in the world.  The country, however, still has a high degree of import dependence – 85% of the products are imported. “This affects healthcare goals of access and affordability. Towards this, the government launched the PLI schemes,” according to S Aparna, Secretary, Department of Pharmaceuticals, Ministry of Chemicals and Fertilizers. “A strong innovation ecosystem must also support startups, with a focus on innovation that meets patient needs and reduces lifetime costs,” she said in a Mint report

Anish Bafna, MD and CEO of medtech company Healthium, says there is excessive reliance on imported medical devices and consumables. “The supply chain infrastructure needs greater resilience, manufacturing is very fragmented and there is a strong need to create access to high quality, high precision medical devices in the country,” he told Financial Express. “While a humanitarian crisis of this scale cannot be seen as a profiteering opportunity, it has definitely added the much-needed tailwind for the sector to be recognised for its importance and be positioned in the right light.”

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