SECTOR PROFILE

WHY INDIA?01

CHAMPION SECTORS02

PROFILE03

INVESTMENT OPPORTUNITIES04

BUSINESS & REGULATORYENVIRONMENT IN INDIA

05

WHY INDIA?01

ADVANTAGE INDIA

World’s largest democracy with

1.3 billionpeople

Expertise acrossa spectrum of

services

Largecompetitively-priced skilled

talent pool

Large andgrowing domestic

consumermarket

Demonstratedcapability to deliver

high-quality,cost-effective

solutions

Integrated taxstructure

Enablingbusiness

environment

Focus oninfrastructuredevelopment

Access totechnology

INDIA - A FAVORED INVESTMENT DESTINATION

Fastestgrowing major economy in the world in 2018 and 2019

6th largest economy in the world by nominal GDP and 3rd largest economy globally by PPP

1st rankglobally in inward greenfield FDI inflows in 2016

India ranks 8thin global services exports accounting for 3.4% ofworld trade incommercialservices

Services,

57%

Automobile, 5%

Pharma, 4%

Power, 4%

Others,

26%

Chemicals, 4%

Agriculture17%

Industry22%

Services61%

6.1

60.1Mauritius, 34%

Singapore, 17%Japan, 8%

UK, 7%

USA, 6%

Netherlands, 6%

Others,22%

India’s GDP is likely to touch US$ 5 trillion by 2025

2.6

4.7

2017 2023

GDP in current prices (US$ Trillion) GVA share of sectors in FY18

43.2

163.1

27.8

95.7

2004-05 2016-17

Exports

Imports

Services Trade (US$ Billion)

14%

10%

1%

1%74%

Category-wise Services Export (2016-17, % share)

17%

15%

1%

1%

66% Travel

Transport

Insurance

G.n.i.e

Miscellaneous*

Category-wise Services Import(2016-17, % share)

Gross Foreign Inflows-FDI (US$ Billion) Top FDI source countries (% share in inflows- Apr’00 to Mar’17)

G.n.i.e- Government not included elsewhere; * includes software, business, financial and communication services

20

04

-05

20

05

-06

20

06

-07

20

07

-08

20

08

-09

20

09

-10

20

10

-11

20

11

-12

20

12

-13

20

13

-14

20

14

-15

20

15

-16

20

16

-17

Sector-wise FDI inflows (% share in inflows-Apr ‘00 to Mar’17)

75

60

45

30

15

0

Source: IMF, FDi intelligence report 2017, RBI, WTO

GROWTH ENABLERS

Growing domestic consumer base Large, young human capital base

Rising disposable income and urbanization More than 800 million people under the age of 34 years

Urb

an p

op

ula

tio

n (%

of

tota

l)

Pe

r-c

ap

ita I

nc

om

e (

INR

)

18,523

61,855

27.8

31.270000

60000

50000

40000

30000

20000

10000

0

32.0

31.0

30.0

29.0

28.0

27.0

26.0

2001 2011

Urban Population and Per-capita Income

Per capita income Urban population

Per-capita Income data pertains to 2001-02 and 2011-12Source: Census 2011, MOSPI

Size of the workforce (millions)*

37

35

27

1400

1200

1000

800

600

400

200

0

Korea Thailand Japan US Europe China India

2015 2025 (Projected) 2050 (Projected)

49

47

36 77

71

55

213

217

235

492

466

405

1008

984

795 860

985

1145

* Population aged 15-64 yearsSource: United Nations population statistics

CHAMPIONSECTORS

02

Transport

& Logistics Healthcare Accounting

& Finance

Construction

& Related

Engineering

Services

Media &

Entertainment

Education

Services Financial

Services

Environmental

Services

Tourism

& Hospitality

IT & ITeS Legal

Services

Communication

Services

((( (((

INVESTMENT ANNOUNCEMENTS

• Texas Pacific Group, TPG (one of the world’s largest private equity firm)

and Manipal Hospitals have committed to invest USD 0.61 billion in the

combined entity resulting from the Fortis-Manipal hospital merger.

• In 2016, TPG invested US$ 33 million in Cancer Treatment Services

International for 65% stake.

• In 2016, Abraaj Group invested USD 221 million in Care Hospital Chain.

• In 2015, Max Healthcare (MHC) acquired 51% stake in Saket City Hospital

Private Limited from the Smart GroHealth City Pte Ltd.

• TPG acquired majority stake in Rhea Healthcare for USD 33 million in 2016.

• International Finance Corporation (IFC) invested USD 68 million in Apollo

Health & Lifestyle in 2016.

PROFILE:HEALTHCARESERVICES

03

NET SALES OF HEALTHCARE SERVICES HAVE BEEN GROWINGAT AN AVERAGE OF 12.1%

12.1

14.413.6

11.2 10.8

10.5

0

2

4

6

8

10

12

14

16

Q1 FY2017 Q2 FY2017 Q3 FY2017 Q4 FY2017 Q1 FY2018 Q2 FY2018

Gro

wth

Ra

tes (

in %

)

Quarters

Growth in net sales of health services (in %)

Source: Economic Survey 2017-18

INDIA’S PRICE ADVANTAGE IN HEALTHCARE SERVICES

Source: J.P. Morgan (2014)

India has 36 Joint Commission

International (JCI) accredited

hospitals and 480 hospitals

accredited by National

Accreditation Board for Hospitals

and Healthcare Providers (NABH).Heart Bypass

Heart Valve Replacement

Hip Replacement

Knee Replacement

180

160

140

120

100

80

60

40

20

0

US Thailand Singapore Malaysia SouthKorea

India

Pro

ce

du

re C

ost

'000 U

SD

130 7

160 9.5

43 7.02

40 9.2

11

10

12

10

18.5

9

12

13

9

9

12

8

31.7

42

10.5

11.8

STEADY INCREASE IN FOREIGN DIRECT INVESTMENT (FDI)

Source: Department of Industrial Policy and Promotion

FDI increased by 31.6%

from 2014-15 to 2016-17.

567.9

742.4 747.4

0

100

200

300

400

500

600

700

800

2014-15 2015-16 2016-17

FD

I (U

SD

Millio

ns)

Years

FDI in Hospital & Diagnostic centres

HEALTHCARE TOURISM

Source: Data for 2010-13 is from Indian Tourism Statistics.Data for 2015 is from Directorate General of Commercial Intelligence and Statistics (DGCIS).

Growing number of

healthcare tourists

represents a golden

opportunity for India’s

service exports.155.9

138.8

171.0

236.9

184.3

459.7

0

100

200

300

400

500

2010 2011 2012 2013 2014 2015

Year

Number of Healthcare Tourists in India

INDIA IS A POPULAR DESTINATION FOR HEALTHCARE TOURISTS

Source: Data for 2010-13 is from Indian Tourism Statistics. Data for 2015 is from DGCIS.

Healthcare tourists

from Asia and Africa

visit India more often

than those from other

parts of the world.

49.0 38.6

-6.6

58.9

22.8

153.1

32.6 43.5

27.3

65.5

10.1

45.2

14.0

64.3

37.0

-20

30

80

130

Ba

ng

lad

esh

Ira

q

Ma

ldiv

es

Afg

ha

nis

tan

Nig

eri

a

Ne

pa

l

UA

E

Ke

nya

US

A

Bh

uta

n

UK

Pa

kis

tan

Ge

rma

ny

So

uth

Afr

ica

Fra

nc

e

AA

GR

(in

%)

AAGR (in %, 2010-15) for healthcaretourists in India (Top 10 source countries)

EMPLOYMENT GENERATED BY EXPORTS

Fall in employment

since 2007-08 can be

associated with

improvement in

labour productivity

and increased levels

of technological

adoption.

Source: Export-Import (EXIM) Bank, 2016

13.0 17.4

25.7

37.8 39.5

58.2

66.7

77.6

85.8

68.1

43.3

30.2

16.7

27.6

0.0

10.0

20.0

30.0

40.0

50.0

60.0

70.0

80.0

90.0

100.0

Em

plo

ym

en

t ('

000)

Year

Employment supported by exports of medical and health services

1999

-00

2000

-01

2001

-02

2002

-03

2003

-04

2004

-05

2005

-06

2006

-07

2007

-08

2008

-09

2009

-10

2010

-11

2011

-12

2012

-13

INVESTMENTOPPORTUNITIES

04

GROWTH DRIVERS

• In India, there exists a large pool of English speaking doctors, nurses and

supporting staff.

• India offers low waiting period for healthcare treatment compared to

developed countries.

• The cost of healthcare treatments in India is among the lowest.

• India offers E-medical visa to residents from 161 countries. Also, there

exists low e-medical visa fees.

• The National Health Protection Scheme, announced in Budget 2018,

promises insurance cover for 100 million families.

• Increased awareness of wellness and preventive care appears to be an

important growth driver for healthcare services.

AVENUES FOR INVESTMENT

• There is a significant emphasis on promoting AYUSH services by the government,

which are India’s unique offering to the world.

• Indian healthcare institutions specialise in providing cardiac bypass surgery, bone

marrow transplant and orthopedic surgery, cosmetic surgery, IVF and gynaecology

treatments to foreign healthcare tourists.

• There exists low competition in primary healthcare services.

• E-healthcare and telemedicine are relatively unexplored in the Indian market.

• Investments in wellness, preventive care and diagnostics are likely to reap high returns.

• There exists growing demand for healthcare infrastructure.

• Investment in healthcare services training institutes is likely to be

encouraged and will be rewarding.

BUSINESS &REGULATORY ENVIRONMENTIN INDIA

05

REFORMS FOCUS

Fiscalprudence andaccountability

Integratedtax

regime

Enabling Ecosystem

Servicespush

Job creation and inclusive

growth

REGULATORY ENVIRONMENT - INDIA

Foreign Investment Framework

• Governed by Foreign Exchange Management Act, 1999

• Progressive liberalization in the policies

• Automatic route (No prior approval requirement) such as railway and road infrastructure

• Approval route (Prior government approval required before setup) such as multi brand retail trading

Foreign Direct Investment (FDI) in India

Evolution of foreign investment regulations

FDI INVESTMENT ROUTE

Under Automatic Route Prior Approval Route

No requirement of any prior regulatory approval

Filing an intimation with RBI in prescribed format within 30

days of investment

Filing particulars of issue of shares within 30 days of issue

of shares to foreign investors

Filing an intimation with RBI in prescribed format within 30

days of investment

Filing particulars of issue of shares within 30 days of issue

of shares to foreign investors

Required approval from Govt. of India – Considered by respective Administrative Ministry/Department.

BUSINESS PRESENCE IN INDIA - FORM OF ENTITIES

Establishes local presence

Operates as a foreign company

Foreign Company

Liaison Office Project Office Branch Office Joint Ventures Limited Liability Partnership

Wholly Owned Subsidiary

Key considerations for choosing

investment vehicles

• Commercial considerations

• Regulatory framework (prior approval requirements for Chinese companies)

• Tax considerations

• Cost of operations{

This Report has been prepared by CII.

IT & ITES