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  • Knowledge Partner

    Social Infrastructure: A look at enabling elements for growth and development in North India

    Confederation of Indian Industry

  • 2014 KPMG, an Indian Registered Partnership and a member firm of the KPMG network of independent member firms affiliated with KPMG International Cooperative (KPMG International), a Swiss entity. All rights reserved.

    Table of contents

  • Education- Macro scenario in India and key indicators 03

    North India - Economic and demographic profile 05

    Private investment opportunities in North India 11

    Appendix 13

    Healthcare - Macro scenario in India and key indicators 15

    Healthcare - India vs other nations Need for change 17

    Economic and demographic profile - North India 21

    Healthcare and disease trends in North India 23

    Key need-Gaps and infrastructure requirements in north india 25

    Emerging healthcare models and opportunities 27

    Government initiatives 29

    Private player initiatives 30

    Key recommendations 31

    About KPMG in India 33

  • India is poised to be the worlds youngest country by 2020 with an average age of 29 years. Currently, a third of the population is under 15, more than half under 24 and every third person in a city is between 15 and 32. Thus, India is at the peak of its demographic dividend. This is not only expected to be the largest source of labour in the world, but also drive demand for products and services, thereby fuelling the overall economic growth of the country. However, to realise the full potential of its demographic dividend India will have to focus on social sectors such as education and healthcare.

    Promotion of education and skill building initiatives to foster inclusive economic growth would be critical. While the education sector in India has developed substantially since independence, the major challenge faced by the government is in bringing disadvantaged sections of the community into this plan. A few examples of these challenges include:

    Dropout rates in primary and secondary education

    Quality of education in public schools

    Quality and employability of graduates from institutes of higher education.

    As the government alone cannot shoulder the entire responsibility of these challenges, there is a clear need for more participation from the private sector at all levels of education and skill building. Realising this, states in Northern Region have taken the lead in setting up a policy framework to encourage private sector participation in education sector, under various PPP models. This has opened up several investment opportunities for private sector.

    Along with education and skill development, focus on health is important to ensure a healthy and productive workforce. As per a study conducted by National Bureau of Economic Research (NBER) on the effect of non-communicable diseases on economy based on WHOs EPIC (an excel based interface tool) model of economic growth, the cost of non-communicable diseases is around USD 6.2 trillion for India for the period between 2012-2030. Thus, the country has to invest in ensuring that the population is getting the right education and treatment to support the envisaged growth.

    Healthcare delivery to over 1.2 billion people distributed across its wide geography has always been a challenge for the country. Healthcare expenditure in India is only 5 percent of the countrys GDP as compared to the global average of 10.6 percent. The highly skewed infrastructure distribution between rural and urban India only adds to the issues raised by the demand supply gap. The government, along with assistance from the private sector, has been investing on making healthcare accessible and affordable. However, the country needs higher investments and intelligent distribution of resources to bring in focused development in the sector.

    Healthcare delivery in northern India has been following a similar trend as the rest of the country. While cities like Delhi have improved infrastructure, rural areas are yet to have access to affordable healthcare. The northern states, with a higher than average Net State Domestic Product (NSDP) of India, have a higher affordability leading to a greater demand for primary and super specialised care.

    Hence, both education & skill development and healthcare sectors offer conducive climate for investment in the northern states.

    Introduction

    Social infrastructure - A look at enabling elements for growth and development in North India | 2

  • 01 | Decoding the realty challenge

    01 Education Macro scenario in India and key indicators

    OverviewIndia is a nation dominated by youth, with the largest population in the world in the age group of 0-24 years, and an estimated 63 percent of the total population will constitute the workforce by 2022. The education and skill development sector is thus of critical importance in providing support for enhancing the skills of the rising population and improving the economic efficiency of the nation.

    The Indian education and skill development sector stood at INR1.24 trillion in 2008 and is expected to grow at an average rate of 13 percent to over INR 2.92 trillion in 2014. Central and state government initiatives, PPP partnerships and increased focus on skilling have led to strong growth in the vocational education sub-segment which has been steadily growing at an average rate of 22 percent annually.

    CAGR (2008-14)

    K-12

    Vocational Education

    Higher Education

    Overall

    13%

    22%

    11%

    13%

  • 1. According to the 68th NSSO survey

    Growth driversThe education and skills sector can attribute its growth to multiple factors- key among those include a young, growing population, increasing focus on quality education, policy support and increased participation of private players-

    Demographic profile- According to International Labour Organisation (ILO) estimates, by 2020 India will have 116 million workers in the age group of 20-24 years as against 94 million in China. In addition to this, the average age of Indian population by 2020 will be 29 while many developed countries will be in early or late 40s. An estimate suggests that India will need another 50,000 colleges and 1000 universities for its 40-45 million college ready students by 2020.

    Willingness to spend on education- With globalisation and technological advancement there is an aspiration to attain higher standard of living among people. This has created an awareness about the importance of education and

    skilling and hence expenditure on education has been on the rise. Spending on education in cities was 6.9 percent versus 3.5 percent in villages and together with medical expenditure are the third largest category in terms of consumer expenditure, next to durable goods, and clothing and footwear.1

    Increased investment by government The new government is looking to increase education spends to 6percent, and has proposed to create a separate ministry of skills and entrepreneurship which is likely to boost the growth of the sector.

    Growth of private education providers - The growth in higher education in the country over the last decade has been led by the private sector. The private segment currently accounts for more than a third of overall enrolment and about 80 percent of enrolments in professional and technical education.

    ~160,000

    ~204,000

    ~48,000

    ~60,000

    ~7,000

    ~19,000

    ~28,000

    ~124,000

    ~228,000

    ~292,000

    50000

    100000

    150000

    200000

    250000

    300000

    350000

    2012 2014P

    0

    ~29,000

    ~88,000

    2008

    6%

    23%

    71%

    70%

    21%

    10%

    Rs.

    Cro

    re

    Vocational EducationK-12 Higher Education

    Education sector - Market size (INR Cr.)

    Social infrastructure - A look at enabling elements for growth and development in North India | 4

  • 01 | Decoding the realty challenge

    02 North India Economic and demographic profile

    Demographic profile An analysis of the demographic profiling of the North India reveals the following:

    The northern states together constitute over 30 percent of Indias population. Particularly Uttar Pradesh is one of the most populous states with a population of nearly 200 million

    Barring the hilly states, population density in other states is much higher when compared to the national average. Two of the nations most densely populated regions- Delhi and Chandigarh are also located in the heart of the north

    Higher education is a sector of prime importance in the north where more than two thirds of the population is between the ages of 15 and 59.

    In states such as Uttar Pradesh and Rajasthan, where more than one third the entire population is between the ages 0-14, the school (K12) sector will be of critical focus.

    StatePopulation (000)

    Population Density (per sq. km)

    Yearly growth (2001-11)

    Population (0-14) (Years)

    Population (15-59) (Years)

    Population (60+) (Years)

    Sex Ratio (Females per 1000 males)

    2011 2011 2009 2009 2009 2011

    Haryana 25,353 573 2.0% 31% 65% 7% 877

    Punjab 27,704 550 1.4% 26% 67% 8% 893

    Rajasthan 68,621 201 2.1% 35% 63% 7% 926

    Uttar Pradesh 1,99,581 828 2.0% 36% 62% 6% 908

    Delhi 16,753 11,297 2.1% 29% 65% 6% 866

    Himachal Pradesh 6,857 123 1.3% 27% 70% 8% 974

    Jammu & Kashmir 12,549 56 2.4% NA NA NA 883

    Uttarakhand 10,117 189 1.9% NA NA NA 963

    Chandigarh 1,055 9,252 1.7% NA NA NA 818

    India 12,10,193 382 1.8% 31% 66% 8% 940

  • Gross Enrolment Ratio (GER) Analysis With higher education as a sector with a swelling future demand, it is essential that the infrastructure and regulatory framework be developed in a phased manner to meet the potential demand. An analysis of the GER in the northern region reveals that-

    In higher education sub-segment, Uttar Pradesh has the lowest GER among the North Indian states. At 12 percent which is significantly below the Indian GER of around 18 percent, it is a cautionary statistic considering Uttar Pradesh will be the youngest state by 2026, with a median age of 26.85 years. It is imperative that the youth of the state are equipped with higher education and skills failing which they will not be able to contribute productively to the economy and will instead result as a liability for the state and the nation as a whole

    While most of the states GER are range between 14-24 percent, Chandigarh has the highest in the northern region with 46 percent in higher education. As one of the most densely populated cities in the North, the city has the opportunity to draw further investment to the region in the sphere of higher education

    In secondary education, UP and Punjab score below the Indian GER of 53 percent while Himachal Pradesh scores 89 percent

    While Delhi and Himachal Pradesh have 100 percent GER in primary education, Haryana, J&K, Punjab, Rajasthan and Chandigarh are below the Indian GER of 94 percent, possibly due to inaccessibility of schools for remote rural regions, particularly in J&K and Rajasthan.

    School Education GER An analysis of GER across school levels suggests that while there is 100 percent enrolment at the primary level, the figures start dipping increasingly at the middle, secondary and higher secondary levels.

    Social perceptions, affordability, limited access to schools in remote areas are few factors that can be attributed to the increase in drop-out rates. Holistic policy initiatives aimed at strengthening the school sub-segments infrastructure and foundation can help arrest the dropout rates by 2022 and achieve the target GER set out by the government in the 12th Five year plan.

    Higher education GERPrimary GER Secondary GER

    10786

    10586 78

    91 97 98 93 94

    82

    67

    89

    5350

    53 4966 73

    53

    14

    15

    18

    1415

    15 12

    24

    46

    18

    Delhi Haryana HP J&K Punjab Rajasthan UP Uttarakhand Chandigarh India

    (in per cent)

    State-Wise Gross Enrolment Ratios

    SCHOOL

    Source: Statistics of School Education 2010-11, MHRD; UGC annual report 2011-12

    Social infrastructure - A look at enabling elements for growth and development in North India | 6

  • Mill

    ions

    Secondary SchoolPrimary School Middle School

    135 148164

    6275

    8532

    42

    52

    19

    31

    34

    248

    296

    335

    0

    50

    100

    150

    200

    250

    300

    350

    400

    2012 2017(E) 2022(E)

    39.30%

    65.00%

    85.50%

    116%

    85%

    90.56%

    99.56%

    100%

    Higher Secondary

    9%

    05-06 06-07 07-08 08-09

    1213

    1416

    1719

    20

    42

    09-10 10-11 11-12 20-21

    In m

    illio

    ns

    13%

    HIGHER EDUCATION ENROLLMENT

    School Gross Enrolment Ratios

    Number of Enrolled Students in Higher Education and Gross Enrolment Ratios

    65%

    18%

    90%

    30%

    87%

    42mn

    Is the target GER for Higher secondary school (XI-XII) by 2017 as laid by 12th five-year plan

    GER (2011-12) for higher education

    Is the target GER for Middle school (VI-VIII) by 2017 as laid by 12th five-year plan

    is the target gross enrolment ratio in the higher education

    Is the expected gross enrolment ratio in overall school education by 2017

    is the expected enrolment numbers in 2020-21 to meet the target GER

    Higher Education GERThe number of enrolments in 2011-12 in higher education in India was 20 million, up from 12 million in 2005-06 as per UGC annual report, growing at a CAGR of 9 percent. The GER in 2011-12 as per Planning Commission Estimates was 17.9 percent and the government has set itself a target GER of 30 percent by 2020, which translates to nearly doubling the GER within the next 6 years. Currently, India ranks far behind its peers including China and Russia, with respect to GER. There is a sharp need to achieve its set target and maintain a growing momentum in the next few decades in order to rank comparably with its peer nations.

    7 | Social infrastructure - A look at enabling elements for growth and development in North India

  • Electrical & Electronic

    Engineering 15%

    Computer 26%

    Mechanical

    Engineering 12%

    Rest 14%

    Civil Engineering

    & Building

    Construction 3%

    Textile 6%

    Artisan/Craftsman/

    Handicraft

    & Cottage

    Based Production

    Work 2%

    Health & Paramedical

    Services Related

    Work 8%

    Childcare, Nutrition,

    Pre-Schools &

    Creche 2%

    Office & Business

    Related Work 3%

    Driving and Motor

    Mechanic Work 6%

    Beautician, Hairdressing

    & Related Work 3%

    Seating capacity in India for vocational training courses offered by ITI and ITC framework

    Vocational Education GERIn the Indian education system vocational education has remained divorced from the traditional teaching curriculum and is often opted for as an additional degree. It suffers from an image crisis which is detrimental to the skilling initiatives taken by the government and the private players. The government has set itself a target to skill 500 million by 2022 but only 23 percent of the population who is receiving or has already received some form of technical education, chose to attend industrial training institutes (ITIs). An estimated 40-60 lakh people received formal vocational training in the past year.

    The Indian vocational education sector requires further strengthening and a strong shift in perception to ensure that the government targets are met. Nations like Germany, Japan which have a strong technical education backbone provide high quality training to build a skilled and specialised workforce. The vocational sector in India must also take into consideration the qualitative factors such as aspirations and public perceptions in further developing the sector.

    Number of students enrolled and number of institutions in Northern RegionHigher Education

    The North is characterised in the recent years by a drastic increase in the number of colleges (~70 percent compared to the national growth of 37 percent) with a major dominance of private colleges.

    Key statistics:

    North India constitutes 30 percent of Indian colleges and accounts for 30 percent of Indian higher education enrolments

    There has been a 50 percent increment in the no. of enrolments both at the national level and in North India during FY09-12

    Private colleges in North India constitute ~70 percent of the total colleges.

    Social infrastructure - A look at enabling elements for growth and development in North India | 8

  • Total number of students enrolled

    Total number of enrollments

    Total number of colleges

    Total number of Schools

    2008-09

    2008-09

    2008-09

    2008-09

    North

    North

    North

    North

    In M

    illio

    nsIn

    Mill

    ions

    In N

    umbe

    rsIn

    000

    India

    India

    India

    India

    4.14

    79

    6,121

    422448

    10,48925,951

    13311399

    35,5396.17

    83

    15.76

    240

    20.33

    248

    2011-12

    2011-12

    2011-12

    2011-12

    School Education (K-12)

    The school segment in the north is spread across a large spectrum, from super premium international schools to rural government institutions. One third of the total number of schools in India are located in the North, with the segment growing steadily over the past five years.

    Key Statistics:

    Northern region constitutes ~34 percent of the enrolment in K-12 schools pan India

    Number of K-12 schools has increased at a healthy rate of ~5 percent over last few years

    The enrolments in North has increased at 5 percent in comparison to Indias increment of 3 percent in K12 education.

    Vocational/Professional Education:

    The number of polytechnic colleges and technical institutes are higher in the southern regions of India, with the north constituting less than one third the total number of polytechnics. Specialising in engineering and medicine is lagging behind in polytechnics, with more than 55 percent of the institutes focused on Management. However, increasing policy focus and the rise of public-private partnerships have led to a swell in the number of institutions and enrolments, in the recent years, particularly technical institutes (for undergraduate studies).

    Key Statistics:

    Number of technical institutes(undergraduate) in India has grown from 3,536 in 08 to 4,506 in 11 at a CAGR of 8 percent

    Number of postgraduate technical institutes pan India has grown from 6,413 in 08 to 7,516 in 11 at a CAGR of 5 percent

    Number of polytechnic institutions in India has grown at a CAGR of 2 percent from 2,969 to 3,139 in the same period.

    9 | Social infrastructure - A look at enabling elements for growth and development in North India

  • Management 55% Engineering 32%

    Pharmacy 10%

    Medical 3%

    Segmentation of college by specialisation in North

    Polytechnic Colleges

    North India India

    No. of Polytechnic Institute 981 3139

    No. of Total Enrollments 354,994 2,235,216

    Projected gap in enrolment and education infrastructure till 2021Significant capacity creation is required in K-12 segment as there is a perceived increase in enrolment numbers to the tune of 11.3 million across North India by 2021 to achieve overall 98 percent GER. In traditional colleges, the gap in enrolment is 2.9 million to achieve 30percent GER in higher education by 2021.

    The gap in enrolments for North India is 1.25 million for engineering and 0.3 million for medical to achieve 30 percent GER in higher education by 2021. UP leads the enrolment gap numbers in both engineering and medical colleges. Almost 60

    percent of the enrolment gap is from the state of UP and hence significant capacity creation is required in the state.

    To achieve 30 percent GER in higher education by 2021, significant investment should be made in polytechnic colleges to support the gap of 2.1 million in terms of numbers. In management colleges, the total gap stands at 0.23 million.

    The following table summarizes the enrolment gap (in 000s) as of 2021 across the education sector in India Northern Region

    State K12 Engineering Medical Management Polytechnic Traditional

    Delhi 444 78 20 15 132 186

    Haryana 711 72 18 14 122 171

    HP -- 10 2 2 17 24

    J&K 107 28 7 5 48 68

    Punjab 1,147 54 14 10 91 128

    Rajasthan 1,488 226 56 42 381 536

    UP 7,114 776 194 146 1,310 1,844

    Uttarakhand 50 7 2 1 12 16

    Chandigarh 257 -- -- -- -- 1

    Total 11,317 1,252 313 235 2,112 2,973

    Social infrastructure - A look at enabling elements for growth and development in North India | 10

  • 01 | Decoding the realty challenge

    03 Private investment opportunities in North India

    Advantage North India The Northern region has seen rapid growth of educational institutions in the recent years. The students from North Indian institutions are considered to fare better while the state governments invest heavily in education initiatives.

    Higher spend on education

    According to estimates, the states in the northern region on an average, spend higher on education than the rest of the country. In 2010, the national average spend on education was 0.7 percent of GDP, while Delhi, Haryana and Punjab spent 1.17, 2.05, 2.23 percent of their GDP on education respectively. The highest spend however is by UP and Bihar where the literacy rates are some of the lowest in the country. While UP spends 3.67 percent of its GDP in modernisation of education system, Bihar doles out as much as 5.7 percent.

    Supporting policy framework

    A majority of the Northern states have taken special care to introduce policy measures that can support the growth of the education sector. Supportive policies include subsidies and tax waivers for setting up educational institutions and removing rigidities in law that prevent investment. For example, Rajasthan has recently decided to repeal the central apprenticeship act in a bid to create a more flexible environment for training industrial apprentices and thus increasing the total workforce qualitatively and quantitatively. Further details of state specific policies are outlined in the appendix.

    North Indian students competitive advantage

    According to a study, released in January 2014, done jointly by HR consultancy firm PeopleStrong, Wheebox.com and industry body CII --which captures the hiring and talent trends within the country-- students from the north perform better than their southern counterparts. Students from northern states Punjab, Haryana, Delhi, UP and Rajasthan were found to be more likely to qualify for the employable grade, with an overall score of 60 percent and above. (All students were tested on Mathematics, English and computers besides their own domain knowledge and behavioural skills.)

    Assessment of the candidates knowledge in three core subjects Mathematics, English and Computers reveal that north Indian states dominate in the top five list. Rajasthan tops with its students scoring the best in all the above three core areas, reflecting a better overall education quality in the state.

    Growth in cross cultural & affluent population

    Driven by an increase in the number of MNCs setting up base, in cities like Noida and Gurgaon; there has been a rapid increase in affluent population with cross cultural background. This has increased the demand for education with global standards. Also key North Indian states such as Rajasthan, Haryana and Punjab have focused initiatives to emerge as education hubs by encouraging private players to invest in building the educational infrastructure in the states.

    This has resulted in the rise in number of private school chains with international curriculums like Amity International, Pathways, Ryan International and Manav Rachna School. Also in the higher education space, a number of private universities like Amity, Sharda in Uttar Pradesh; Shiv Nadar University, O.P. Jindal Global University, Apeejay Stya University, GD Goenka University in Haryana; Chitkara in Himachal Pradesh; NIIT, Raffles in Rajasthan; Lovely Professional University, Chitkara in Punjab have been established.

    Driven by favourable demographic and economic development; the following opportunities for private participation in education is expected to increase further in several areas.

    Emergence of cities like Noida, Gurgoan etc as an Industrial and Services hub

    Rise in Affluent population with cross cultural background

    Demand for education at global standards

    Demand for high quality education

  • Private investment opportunities in North India

    The results signify the investment opportunities by private players in the northern region which could change its education and skill development landscape; especially through public-private partnerships.

    Examples of public-private partnerships in North India

    Realising the urgency of the task at hand to educate and skill its youth the state governments of north India have also roped in private players to achieve its goal. Some of the public-private partnerships are highlighted below:

    Amity University has signed a pact for establishing an educational complex in Kanpur for INR 2,000 crore at the recently held investors conclave in Uttar Pradesh

    In Haryana - an Indian Institute of Information Technology (IIIT) is being established at village Kilord, district Sonipat in PPP mode by Ministry of Human Resource and Development Government of India for which Gram Panchayat has offered a land measuring 128 acres, 7 kanal, 6 marla

    1000 schools in Punjab in PPP mode whereby 5 acres of land offered on lease and 20 percent of the poor children to get free education

    In Jammu and Kashmir Reliance Industries is planning to set up an institute of management and information technology with an intake capacity of 250 students in the state. The institute will offer courses in five streams of information and communication technology, biotechnology, health, tourism and medicinal and aromatic plants

    After residential schools, the Uttarakhand government is planning to run its primary schools under the PPP mode. In the first phase, eight primary schools in Dehradun district would be operated under a pilot project scheme

    HCL Technologies worked with the state government of Uttar Pradesh to fund IT education in 120 primary schools on a PPP model

    Punjab Technical University (PTU) has announced that it has signed a MoU with University of California, Santa Cruz (UCSC) for setting up an Institute of Excellence (IOE) at Chandigarh. It will be set up at the New Chandigarh Education City that will be spread over 2000 hectares in the city and the government has assured the foreign institutes of all possible help - be it permissions, sanctions and clearances; or infrastructure including land. The Punjab state government shall bear all the cost

    In 2012, the Himachal Pradesh government had announced that 33 Government ITIs were being upgraded under the PPP mode in the state. A provision of INR 41.25 crore has been made for upgrade of infrastructure, procurement of equipment and civil works in these ITIs.

    Establishing

    formal education

    institutes and

    expanding existing

    ones under PPP

    model

    Providing course content,

    development, training services,

    training personnel etc.

    Partnering with

    foreign players to

    establish local

    campuses/

    institutes

    Developing infrastructure,

    executing management contracts

    Investment

    Opportunities

    InterGlobe Enterprises and CAE, a Canada-based civil and military aviation simulation training company, has launched Indias largest pilot simulation training facility in Greater Noida, Uttar Pradesh.

    The centre, CAE Simulation Training Private Limited (CSTPL), is a joint venture between InterGlobe Enterprises and CAE. An investment of over US$ 25 million has already been made in setting up the facility and equipment.

    With its six simulator bays, the centre will have the capacity to train over 5,000 aviation professionals per year, and will be the largest such facility in India. This will also be the first centre in India to impart Airbus certified training. The centre started operations in August 2013 and already provides training to IndiGo pilots.

    CSTPL is the fifth aviation training location that CAE operates in India. CAE also operates a joint venture helicopter training centre in Bengaluru equipped with the first advanced, full-fidelity helicopter simulators in India. In partnership with the Government of India, CAE also operates ab-initio flight schools in Gondia and Rae Bareli.

    The Shiv Nadar University (SNU) was started in 2011 in Dadri, Uttar Pradesh through a state act. UP is one of the highly populated states in the North with a very high portion of the population between the ages of 15-59, making it an ideal destination for higher education institutions. The university is a private foundation aimed at participation in public and private/civil society organisations and commercial enterprises with an INR 31 Crore fund for granting scholarships.

    The university since 2011 has introduced 14 undergraduate courses across their five schools spanning Engineering, Natural Sciences, Communication and more recently, Humanities & Social Sciences and Management & Entrepreneurship. The promoter Shiv Nadar has pledged INR 3,000 Crore to develop education institutions including the university which has so far received INR 512 Crore and it is envisaged that the university will launch its school of Law in 2015.

    The university in an effort to build investments and partnerships has collaborated with several top foreign universities including Carnegie Mellon University, University of Pennsylvania (Annenberg School for Communication) and Duke University. The partners set up a joint Center for Global Communication Research at SNU in 2012.

    Case Study: Technical partnership and PPP for aviation training in North India

    Case Study: Establishment of formal institutes and foreign partnerships in higher education

    Social infrastructure - A look at enabling elements for growth and development in North India | 12

  • 01 | Decoding the realty challenge

    04 Appendix

    State-wise Policy/Educational Initiatives Apart from implementing various educational and skill development initiatives taken by the central government, state governments in northern India have initiated various measures to improve the education standard of their respective states. Listed below are a few examples initiated across the northern states:

    Rajasthan

    As per Rajasthan governments State Policy provisions have been made to allot 10 acres of land, free of cost, to the private investor for setting up a polytechnic college in backward districts

    Free buildings will be provided if the private investor prefers to establish Women Polytechnic in the lagging district

    Udyog Sansthan Sahabhagita Yojana for private parties to run second shift in existing government ITIs

    Scheme for establishing engineering college under PPP mode in 18 districts where facility of engineering college is not available, with provision of providing 10 acres of land free of cost

    Scheme for adoption of ITIs by private sector

    The state is looking at building a new IIIT at Kota.

    Haryana

    A state-level School for Teacher Education of international standards is coming up at Silani Kesho, Jhajjar. The school would provide pre-service training to prepare professionally competent teachers to meet the manpower requirement of future pace setting schools being established in the state. In addition, it would provide in-service training, research and also organise other school development programme. This innovative 4 year integrated programme leading to B.A./B.Sc./B.Com./B.Ed. degrees is being started from the academic year 2013-14

    For providing education in rural areas and to bridge rural and urban gaps, Kisan schools are being established. These schools will have excellent physical infrastructure, better equipped labs and sports activities. Hostel accommodation for students and transport facilities will be provided to the students, if necessary. Initially 7 Kisan schools one each in

    Rohtak, Jind, Yamuna Nagar, Karnal, Jhajjar, Mahendergarh and Bhiwani district are being established. Subsequently all other districts will have a kisan school

    Rajiv Gandhi Education City coming up on a 2000 acre campus in Kundli would be the single largest higher education complex in the world to serve about 1.5 lakh students in 10 universities

    State Government has decided to establish National Law University at Sonipat which will be a State funded University and will be raised with Government grant of INR100-110 crore. This University will be developed as centre of excellence

    The state has signed a memorandum of understanding (MoU) with Michael and Susan Dell Foundation to improve the quality of education in the states government schools .The foundation will target 16 lakh children studying in 12,000 state-run primary and middle schools across Haryana as part of the quality improvement programme

    Indian Institute of Management, Rohtak is being established by the Ministry of Human Resource Development, Government of India over a sprawling area of 200 acres at Rohtak. The State Government has made the land available free of cost

    Indian Institute of Information Technology (IIIT) is being established at village Kilord, district Sonipat in Public Private Partnership (PPP) mode by Ministry of Human Resource Development, Government of India for which Gram Panchayat has offered land measuring 128 acres, 7 kanal, 6 marla

    National Institute of Design (NID) is being established in Umri (on NH-1) in district Kurukshetra. Land measuring 20.5 acres has been provided by the Gram Panchayat, Umri for establishing this institute of national importance.

    Punjab

    1000 schools in PPP mode whereby 5 acres of land offered on lease and 20 percent of the poor children to get free education

    Under the EDUSAT scheme 3823 virtual classrooms have been setup benefiting 3 lac students

    The Punjab Agricultural University at Ludhiana is well known for its outstanding contribution to education, research and extension services in the field of agriculture

    The state government is planning to set up an Indian Institute of Information Technology (IIIT) in Kapurthala.

  • AppendixHimachal Pradesh

    The Skill Development Allowance scheme is a flagship programme of the Government. A budgetary provision ofINR 100 crore has been made for this scheme for the financial year 2013-14. Its purpose is to aid the educated unemployed youth of Himachal Pradesh to enhance their employability and income through skill development

    Himachal Pradesh is placing special emphasis on girl education, with the implementation of National Programme for Education of Girls at Elementary Level (NPEGEL) in eight educationally backward blocks, where rural literacy rates were below the national average

    The state is planning to establish 16 new universities in an effort to boost vocational and higher education

    Private participation is being encouraged in technical and vocational education.

    Uttar Pradesh

    The Rajiv Gandhi Institute of Petroleum Technology was set up by the Ministry of Petroleum and Natural Gas (MOP&NG), Government of India-at Jais, Rae Bareli district, Uttar Pradesh through an Act of Parliament. RGIPT has been accorded

    Institute of National Importance Status along the lines of the Indian Institute of Technology (IIT) and Indian Institute of Management (IIM)

    Private university Amity has signed a pact for establishing an educational complex in Kanpur for INR 2,000 crore recently.

    Uttarakhand

    Government of India has proposed to set up a textile skill training programme in Uttarakhand at an estimated cost of USD18.4 million. Around 15,000 people are expected to be trained under the programme in the next five years

    For the year 2012-13, the state government has allocated USD 814.3 million for school education and USD 47.3 million for higher education.

    Jammu and Kashmir

    The government has approved an ambitious INR1,039 crore plan to establish new universities, technical colleges, model degree colleges, polytechnics and upgrading the existing higher educational system in the state

    Seasonal schools have been opened for people in the hilly areas and the under-privileged population

    Two central universities have been set up to boost the educational infrastructure in the state, one in Kashmir division and another in Jammu division. They have instruction and research facilities in emerging sectors such as IT, biotechnology and nanosciences.

    Social infrastructure - A look at enabling elements for growth and development in North India | 14

  • 01 | Decoding the realty challenge

    05

    IntroductionHealthcare in India today provides existing and new players with a unique opportunity to achieve innovation, differentiation and profits. In the next decade, increasing consumer awareness and demand for better facilities will redefine the countrys second largest service sector employer.

    Indias primary competitive advantage over its peers lies in its large pool of well-trained medical professionals. Also, Indias cost advantage compared to peers in Asia and Western countries is significantly lower cost of surgery in India is one-tenth of that in the US or Western Europe.

    The diagnostics sector in India has also been witnessing immense progress in innovative competencies and credibility. Technological advancements and higher efficiency systems are taking the market to new heights.

    The private sector has emerged as a vibrant force in Indias healthcare industry, lending it both national and international repute. Also, hospital and diagnostic centres attracted foreign direct investment (FDI) worth Rs. 11,272.32 crore (USD 1.87 billion) between April 2000 and Feb 2014.

    However, there is still a significant scope for enhancing healthcare services considering that healthcare spending as a percentage of GDP is rising. This presents vast opportunities for investment in healthcare infrastructure in both urban and rural India.

    In northern India, the health care delivery sector, including hospitals and diagnostic services, is growing rapidly. The north has begun seeing proliferation of specialty hospitals and healthcare centres, with major players such as Fortis, Apollo, Medanta and Metropolis investing in this space.

    Many state governments in the North have been encouraging hospitals to get accreditations to prove that their healthcare is good enough for visiting tourists.

    The Indian healthcare industry has been growing at a CAGR of 12 percent and is expected to grow at the same rate going forward. It expanded from USD 40 billion in 2007 to USD 81 billion in 2013 and is expected to reach USD 179 billion by 2020.

    The size of the healthcare market is estimated to increase from USD 81 billion in 2013 to USD 179 billion in 2020.

    Healthcare Macro scenario in India and key indicators

    CAGR 12%

    0

    2007

    20

    40

    60

    80

    100

    120

    140

    160

    180

    200

    2008 2009 2010 2011 2012 2013 2020

    40 43 4454

    6572

    81

    179

    Healthcare market in India

    Delivery 65-70%

    Insurance 4-5%

    Pharma 13-15%

    Diagnostics 3-5%

    Devices 9-10%

    Composition of Healthcare market

    Source: JP Morgan, Aranca Research

    Source: JP Morgan, Aranca Research

  • Healthcare delivery comprises majority of the pie of the healthcare market in India with 65-70 percent of the total healthcare revenues followed by pharmaceuticals with 13-15

    percent. Medical Devices also hold a considerable share with 9-10 percent, followed by Medical Insurance at 4-5 percent and Diagnostics at 3-5 percent.

    Demographic

    transformation

    Changing

    diseases

    profile

    Increased

    affordibality

    Increased

    penetration of

    private players

    & government

    initiatives

    Growing

    population

    and rising

    life

    expectancies

    Increasing incidence

    of lifestyle & non-

    communicable disease

    Rising

    income,

    growing

    middle

    class and

    increased

    insurance

    Augmented by

    government initiative

    & evolving healthcare

    delivery models

    Currently serving more

    than 8,50,000 foreign

    patients every year

    Influx of

    medical tourist

    Particularly

    for preventive

    care and

    diagnosticsIncreased

    Awareness

    Drivers of the

    Healthcare Industry

    The growth in Indian healthcare is driven by a combination of macro and micro economic factors

    Social infrastructure - A look at enabling elements for growth and development in North India | 16

  • 01 | Decoding the realty challenge

    05

    The healthcare delivery market in India has been growing at 15 percent in the last 5 years (from 2009-2014), faster than the overall healthcare market. However, the country still lags behind many of the developed and developing countries in terms of both overall healthcare expenditure and supply of infrastructure.

    Healthcare Expenditure Format of Expenditure (Private > Public) Private expenditure (Out of pocket > Insurance)

    In terms of healthcare expenditure, India not only lags far behind the developed countries, it even fails to meet the global average spend (5 percent of GDP as against the global average of 10.6 percent). Moreover, this expenditure is highly skewed with more than two third of the contribution coming from the private sector. This is in contrast to that of developed countries in which healthcare expenditure is a state priority. Also, out of pocket expenditure forms the major share of private sector spending showing the low penetration of insurance in the country. Thus, the healthcare market is yet to achieve its true potential since out of pocket expenditure leads to a tendency of procrastination and avoidance of elective care like knee replacement, preventive care etc.

    Healthcare expenditure

    Healthcare India vs other nations Need for change

    0

    2

    4

    6

    8

    10

    12

    14

    16

    18

    20

    2010 2011 2012 2013 2014

    9.6

    17.9

    4.1

    5.1

    9.59

    5

    9.4

    17.9

    4.1

    5.2

    9.69

    5

    9.4

    17.9

    4.1

    5.3

    9.69

    5

    9.6

    18

    4.2

    5.4

    9.7 9.1

    5

    9.7

    18

    4.2

    5.6

    9.79.1

    5

    Srilanka ChinaUK USA Japan Brazil India

    Healthcare expenditure as a % of GDP

    Source: EIU estimates

  • Global average spend on healthcare is around 10.6 percent of their GDP. India fares the lowest amongst some of the developed countries in the world and spends less than half of the global average.

    India has as high as 70 percent of the healthcare expenditure coming from the private sector as compared to the global average of 38 percent and is the highest among all compared developed countries. Also, out of the private expenditure, as high as 86 percent is out of pocket showing low penetration of insurance in the country. Government expenditure however has been increasing over the years and much more investment is required from the public sector to fill the gap.

    Healthcare infrastructure in IndiaThere is an acute shortfall of healthcare infrastructure and healthcare personnel in the country. India not only lags far behind developed countries like UK and USA, it also lags behind the global average and comparable countries like Brazil and Sri Lanka. The planned additions in infrastructure including medical and nursing colleges till 2020 are not enough to meet the demand of the country. While 70 percent of the countrys population lives in rural areas, only 30 percent of the overall healthcare infrastructure is available to them.

    India has the lowest number of beds per 1,000 people among the profiled countries. India has only 0.7 beds per thousand population as compared to the global average of 2.6.

    India

    Japan

    Brazil

    China

    Srilanka

    USA

    UK

    0 80%20% 40% 60%

    70%

    18%

    54%

    44%

    58%

    52%

    17%

    Insurance 14%Out of pocket 86%

    India

    Brazil

    Japan

    China

    Srilanka

    USA

    UK

    0 155 10

    0.7

    2.3

    13.7

    3.8

    3.6

    2.5

    3

    Beds per thousand

    Private Healthcare Expenditure Comparison Type of private healthcare expenditure in India

    Number of beds per 000 people

    A lack of supply coupled with a highly skewed distribution between urban and rural areas creates a need for efficient delivery formats in the country.

    Source: WHO 2014 Statistics

    Source: WHO 2014 Statistics

    Source: WHO 2014 Statistics

    Social infrastructure - A look at enabling elements for growth and development in North India | 18

  • India also lags behind the developed countries in terms of number of nurses per 000 people. India has only 1.7 nurses per thousand population as compared to the global average of 2.8. The European region has almost thrice the global average.

    India has the lowest number of physicians per 1,000 people among the profiled developed countries. The global average is 1.3 physicians per thousand people as compared to only 0.7 for India.

    Acute need for Healthcare professionals in the country

    There is an incremental requirement of 0.9 million doctors over the 2012 supply to meet the global average number of doctors in the country in 2020. As per the Planning Commission data, an incremental supply of 44,000 doctors will be able to meet only 78 percent of the 2020 demand, leaving a gap of 0.3 doctors per thousand people.

    Similarly, an annual supply of 280,000 nurses will be able to meet only 90 percent of the demand by 2020 and an annual supply of 30,000 AHPs (Allied Healthcare Professionals) will be able to meet only 80 percent of the demand in 2020.

    India

    Brazil

    Japan

    China

    Srilanka

    USA

    UK

    0 155 10

    1.7

    7.6

    11.5

    1.5

    1.6

    9.8

    8.8

    Units0.20

    0.40

    0.60

    0.80

    1.00

    1.20

    1.40

    Supply 2012 Supply 2012 Gap Demand 2020

    0.70

    0.30

    0.30 1.30

    Incremental Supply-

    0.51mn doctors

    Incremental Demand*

    of 0.65mn doctors

    India

    Brazil

    Japan

    China

    Srilanka

    USA

    UK

    0 31 2

    Physicians per thousand

    0.7

    1.9

    2.3

    1.5

    0.7

    2.5

    2.8

    Number of nurses per 000 population

    Shortfall of number of doctors per thousand 2020

    Number of physicians per 000 population

    India needs to add 1.7million beds to achieve the target of 2 beds per thousand population by 2020.

    Source: WHO 2014 Statistics

    Source: WHO 2014, Planning Commission, KPMG Analysis

    Source: WHO 2014 Statistics

    Note :*Demand based on realistic ratios of doctors to population as opposed to global standards

    19 | Social infrastructure - A look at enabling elements for growth and development in North India

  • Sr. No.

    Parameters Numbers

    1 Healthcare expenditure as a % of GDP 2014 5%

    2 Private healthcare expenditure as a % of total healthcare expenditure 2014

    Out of pocket expenses Insurance

    70%

    86% 14%

    3 Number of beds per 1000 people 2014 0.7

    4 Number of nurses per 1000 people 2014 1.7

    5 Number of physicians per 1000 people 2014 0.7

    6 Shortfall in number of physicians per 1000 2020 0.3

    Thus, there is a need to build 600 additional medical colleges with 100 seats per college to meet the global average of doctors and nurses per thousand population in the next 15 years.

    Social infrastructure - A look at enabling elements for growth and development in North India | 20

  • 01 | Decoding the realty challenge

    06

    The demographic profiling of the North India reveals the following:

    The northern states together constitute over 30 percent of Indias population with UP, the most populous state, having a population of more than 200 million.

    Barring the hilly states, population density in other northern states is much higher when compared to the national average, with Delhi and Chandigarh being the most densely populated regions in the country.

    The population consists of a sizeable number of baby boomers, which consume considerable share of medical services.

    Economic and demographic profile North India

    StatePopulation (000)

    Population Density (per sq. km)

    Yearly growth (2001-11)

    Population (0-14)% composition

    Population (15-59)% composition

    Population (60+)% composition

    Sex Ratio (Females per 1000 males)

    2011 2011 2011 2011 2011 2011

    Haryana 25,353 573 2.0% 29.7% 61.6% 8.7% 877

    Punjab 27,704 550 1.4% 25.6% 64.0% 10.4% 893

    Rajasthan 68,621 201 2.1% 34.7% 57.7% 7.6% 926

    Uttar Pradesh 1,99,581 828 2.0% 35.9% 56.2% 7.9% 908

    Delhi 16,753 11,297 2.1% 27.2% 65.9% 6.9% 866

    Himachal Pradesh

    6,857 123 1.3% 25.9% 63.8% 10.3% 974

    Jammu & Kashmir

    12,549 56 2.4% 33.8% 58.8% 7.4% 883

    Uttarakhand 10,117 189 1.9% 31.1% 59.9% 9.0% 963

    Chandigarh 1,055 9,252 1.7% 25.3% 68.3% 6.4% 818

    India 12,10,193 382 1.8% 30.9% 60.4% 8.7% 940

  • The economic profiling indicates:

    The net state domestic product (NSDP) of most of the North Indian states is well above the overall average of India with 6 north Indian states figuring in the list of top 13 states with highest per capita SDP.

    The growth in NSDP of these states over the last year has also been significantly above the national average of 2.84 percent.

    StatePer capita NSDP (Constant prices, 2004-2005) INR

    Per capita NSDP (Constant prices, 2004-2005) INR

    Growth in per capita NSDP (%)

    Govt. Per-capita Health expenditure (INR)

    2012 2013 2013-14 2009

    Haryana 64,631 68,040 5.27% 280

    Punjab 48,572 50,233 3.42% 360

    Rajasthan 29,244 30,120 3.0% 287

    Uttar Pradesh 18,866 19,512 3.42% 293

    Delhi 1,18,960 1,27,667 7.32% 840

    Himachal Pradesh 51,730 54,494 5.34% 884

    Jammu & Kashmir 30,335 31,773 4.74% 845

    Uttarakhand 56,251 61,106 8.63% 630

    Chandigarh 96,206 Not Released NA 798

    India 38,856 39,961 2.84% 503

    Social infrastructure - A look at enabling elements for growth and development in North India | 22

  • 01 | Decoding the realty challenge

    07

    The major communicable diseases in the region are tuberculosis, diarrhea and viral hepatitis. The major cause of these diseases is lack of hygienic conditions in urban slums along with unsafe drinking water.

    The major non communicable diseases in the region include cancer, cardiovascular diseases, diabetes and drug addiction. Increasing consumption of alcohol, smoking, job stress, lack of physical exercise coupled with junk food and injudicious use of chemicals in fields are some major causes for these diseases in the region.

    Healthcare and disease trends in North India

    North India has a highly skewed infrastructure with cities like Delhi having much higher than average healthcare infrastructure and areas in UP lagging behind with lack of even basic amenities. Thus, the need of the hour is more investment in accessible and affordable healthcare infrastructure through innovative operating models like telemedicine, hub and spoke, advanced primary care in rural areas, low cost diagnostic centers to improve preventive care , medical camps to create awareness and low cost single specialty delivery models in tier-II and tier-III cities.

  • Social infrastructure - A look at enabling elements for growth and development in North India | 24

  • 01 | Decoding the realty challenge

    08

    The healthcare infrastructure in North India is skewed with Delhi having adequate health infrastructure, much higher than the national average and places like Haryana, Rajasthan and UP lagging behind.

    However, the healthcare market in North India has been growing owing to increased inflow of investments from the private sector. The entire region has been witnessing an increase in the number of hospitals, primary clinics, diagnostic centers etc. Also, the region has been promoting healthcare manufacturing industry by developing SEZs for pharmaceuticals and medical equipments.

    Key need-Gaps and infrastructure requirements in north india

    India

    Rajasthan

    Himachal

    UP

    Jammu and

    Punjab

    Haryana

    No. of Beds

    0 1 2 3

    Uttarakhand

    Chandigarh

    Delhi

    0.7

    0.5

    0.8

    1.3

    0.4

    0.4

    0.7

    0.5

    0.6

    2.8

    India

    Rajasthan

    Himachal

    UP

    Jammu and

    Punjab

    Haryana

    No. of Doctors

    0 1 2 3

    Uttarakhand

    Chandigarh

    Delhi

    0.7

    0.4

    0.3

    0.1

    0.9

    0.2

    0.6

    2.8

    0.3

    1.4

    Number of hospital beds per 000 people Number of doctors per 000 people

    Source: CBHI 2011, Indiastat, KPMG Analysis Source: CBHI 2011, Indiastat, KPMG Analysis

  • Social infrastructure - A look at enabling elements for growth and development in North India | 26

  • 01 | Decoding the realty challenge

    09

    Growth in tertiary care hospitals in the urban areas has led to a high bed density in some parts of the country. Cities like Delhi and Mumbai have a bed density of more than 3 per thousand people. Thus, future potential for growth may not mirror past growth formats. Major healthcare provider Apollo has already started expanding to cities like Nashik, Trichy, Nellore etc. through Apollo Reach. Vaatsalya and Narayana Hrudayalaya are also exploring opportunities in tier II and below areas. However,

    penetration in rural areas and other healthcare delivery models is yet to realise its full potential. Hence, there is potential for growth across the value chain and potential for penetration in underserved areas.

    Also, there are several emerging models in healthcare rising out of an increasing incidence of lifestyle disease and an awareness about specialised care required for those diseases.

    Emerging healthcare models and opportunities

    Preventive and Primary care Institutional Curative care Rehab & Remote care

    Primary healthcare

    services- Under

    Penetrated

    Wellness services- Under

    Penetrated

    GPs and Organised chains

    Fitness, Alternate therapy

    and Rejuvenation

    Traditional IPD format-

    Rural under penetrated

    Tertiary, Secondary ,

    Nursing Home

    New and Emerging

    Formats- Under

    Penetrated

    Single Specialty Hospitals

    Asset Light outreach

    Models

    Day care Format

    Emergency Medical

    Response

    Under Penetrated

    Services

    Rehabilitation centers

    Home care services

    Telemedicine

    Growth Growth

    Gro

    wth

    Supporting healthcare delivery

    Underpenetrated in rural market

    Diagnostic centers (Radiology is underpenetrated in urban areas also)

    Pharmacy Gro

    wth

    DE

    LIV

    ER

    YH

    EA

    LTH

    CA

    RE

    ME

    DIC

    AL

    SU

    PP

    OR

    T

    High Urban penetration; scope in rural areas Under penetrated market

  • Single specialty hospitals, day-care centres and low-cost healthcare models are cropping up as they are PE-friendly business models which do not require high capex like that of hospitals and exit can be achieved in a much shorter time.

    Private equity has invested around USD 3.5 billion in healthcare services in the past five years and, of these, the new formats have managed to grab USD 422 million.

    Moreover, these new formats save the pain of traveling to crowded and far distanced big hospitals and thus it has also received good response from consumers over the years.

    The biggest advantage with these new formats is their ability to lower the cost of healthcare, offering the same procedures as multi-specialty hospitals at almost 20-25 percent cheaper rates. Monthly operating costs of these centres end up 75-80 percent lower than big hospitals because of the space involved.

    Medical TourismThere are more than 410,000 foreign patients visiting the country annually to avail treatment at much lower rates as compared to the western countries. There is an increasing trend towards getting international accreditations among hospitals in the north to attract medical tourists in the region. However, other than Delhi and some parts of Punjab, medical tourism has not yet picked up in other states of North India. Thus, the Northern region could be a major driver to the growth of the USD 1.6 billion* medical tourism industry of the country.

    Expansion

    through hospital

    chains to slow

    down in urban

    India

    Non existent

    Pre and post

    treatment

    care

    By contrast, many

    specialty-driven

    care areas are

    woefully

    unaddressed

    Though current bed capacity

    is 0.9/1000, the benchmark

    is already ~3 for urban India

    Value discovery in rural

    model is yet to be realized

    ~80 organized primary care

    clinics for 865mn urban

    cases

    Disease management and

    wellness are nascent

    concepts

    No organized home care and

    rehab format

    No scaled care model for

    ~70mn diabetics

    ~2,000 tertiary hospitals

    for ~50mn heart patients

    ~11 machines per 000

    ESRD patients

    60 major cancer centers

    for ~3mn cancer patients

    Thus, expansion opportunities in 4

    routes:

    Building of specialty care formats

    Expansion along the value chain- pre

    and post operative care leading to

    holistic patient engagement

    Evolution of low cost secondary care

    models to penetrate tier-II cities and

    below through asset light outreach

    models

    Potential for growth in diagnostics and

    pharmacy

    Hence, going forward, opportunities are bound to arise in a bid to taper the urban rural divide in North India through outpatient clinics, outreach models and low frills facilities and asset light chains.

    Social infrastructure - A look at enabling elements for growth and development in North India | 28

    *KPMG Analysis

  • 01 | Decoding the realty challenge

    10

    The Government of India has taken numerous initiatives to nurture the Healthcare industry in the country. These policies will help boost healthcare market and healthcare spending in the North among other regions.

    100 percent FDI in health services under automatic route, providing long term capital to hospitals, tax benefits to hospitals in rural areas and encouraging PPP model are some of the government initiatives to encourage foreign players in the country.

    RSBY(Rashtriya Swasthya Bima Yojana) , relaxation on import of medical equipments and life saving drugs and tax holidays to hospitals providing health travel facilities further encourage investment in the sector.

    Relaxation of infrastructure requirement for medical colleges without compromising on quality supports medical education and consequent supply of manpower in the country

    Other initiatives like ESIS(Employee standard insurance scheme), CGHS(Central government health scheme), ECHS (Ex servicemen contributory health scheme), NRHM(National rural health mission)and NUHM (National urban health mission)have made healthcare more accessible.

    State-specific Initiatives

    - Uttar Pradesh has adopted a 2 pronged vision to upscale healthcare delivery in the state focusing on technology as topdown & empowerment as bottom-up approach to ensure that the state improves on healthcare parameters. It is working on cloud based IT solutions to monitor the delivery of services and digitization of medical records.

    - The Union Cabinet has approved the proposal for setting up of National Cancer Institute (NCI) at a cost of INR 2,035 crore (USD 333.61 million) in the Jhajjar campus (Haryana) of All India Institute of Medical Sciences (AIIMS). The project is estimated to be completed in 45 months.

    - A 260 acre Medicity is being developed in New Chandigarh and will include world class hospitals and a medical college. Phase I is underway with the development of a leading hospital - Tata Cancer Research Centre and Hospital.

    - The Mohali Biotech Park Ltd. a joint venture of Govt. of Punjab and Govt. of India is setting up a biotech park at Knowledge City, Mohali, to promote the industry in agriculture, food, pharmaceutical, energy and allied sectors.

    - Rajasthan has introduced Medicare Relief Society, a committee entrusted with all the funds, which include user charges, visiting fees, outpatient fees etc. These committees have their own bank account and can decide upon the allocation of funds. The government has also adopted incentives measures such as allotment of land for hospitals at concessional fees

    - Himachal Pradesh initiated a scheme called Vikas Me Jan Sahyog (Peoples participation in development) which envisages 20 percent of the funds being contributed by the people and the remaining 80 percent coming from the State Government. The scheme covers the construction of hospitals, sub-centres and ayurvedic hospitals in a specific area.

    - Tamil Nadu has been aggressively promoting medical tourism by organizing medical tourism fairs and putting up dedicated medical tourism desks. The state also has an improved drug distribution system in place under TMSC.

    - Karnataka government launched telemedicine in association with CISCO, opened a medical education under ESIC and launched Yeshaswini Health Insurance Scheme among other initiatives to promote healthcare in the state.

    Government initiatives

    Other Initiatives

    Supporting Medical Education

    Insurance, Incentives &

    Subsidies

    Encouraging Private Players

    State-specific Initiatives

  • 11Private player initiatives

    Primary

    Care

    HCL Avitas

    GVK EMRI

    Secondary

    Care

    NovaSpecialty

    Surgery

    Tertiary

    Care

    Manipal Health Enterprises

    Medanta

    Fortis

    Apollo

    Ivy

    Max Healthcare Institute

    Columbia Asia Group

    Aerens Gold Souk

    International Ltd.

    And many others

    Diagnostics

    Metropolis

    SRL Limited

    Dr Lal PathLabs

    Though the private sector has made investments across the value chain, tertiary care has gained maximum attention from the private players.

    Note: This listing is illustrative

  • 01 | Decoding the realty challenge

    12 Key recommendations

    Leverage existing infrastructure for providing effective and quality treatment

    Expand along the value chain - pre and post operative care leading to holistic patient engagement

    Evolve effective low cost secondary care models to penetrate tier-II cities and below through asset light outreach models

    Invest in diagnostics and pharmacies to support the demand

    Build specialty care formats where the breakeven is faster

    Improve access to affordable real estate for setting up new healthcare and diagnostic centres

    Adopt the PPP model to lessen the burden on the government and bring in efficiencies of the private sector

    Improve access to indigenous medical devices by providing active support for local entrepreneurs for setting up infrastructure to manufacture indigenous medical devices and offer them at affordable prices

    Address the skill gap through better education and training methods

    Collaborate with reputed international institues and organisations for delivering high quality healthcare education

    Introduce specialised courses such as Healthcare Management, Hospital Administration and the likes

    Infrastructure Development

    Encouragement to Private Players

    Enhanced Healthcare Education

  • ConclusionThe striking feature of the healthcare sector is its potential to grow at an exponential rate in the foreseeable future and present new opportunities within related industries, which will emerge as growth drivers. There is immense potential for each stakeholder (e.g. government, entrepreneurs, healthcare service providers, pharmaceutical companies, medical equipment

    manufacturers, and allied players) to invest in and grow with the sector. However, given the complex and interdependent nature of the sector there is a need for a cohesive and collaborative approach, where all stakeholders effectively work synergistically and leverage the opportunities to create a lasting impact.

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    http://healthcare.financialexpress.com/market-section/808-esic-s-first-medical-college-opens-in-bangalore

    http://www.outlookbusiness.com/article_v3.aspx?artid=282428

    http://texas.construction.com/yb/tx/article.aspx?story_id=id:zI3bMLuQFLtJ2eJefPeIcdDAa29XnYqxP__vSCP-D3PTEdemy9Ap1_Pk5uVWZBdO

    http://www.memorialhermann.org/news/memorial-hermann-health-system-to-launch-major-renovation-and-expansion-to-its-texas-medical-center-campus/

    http://trauma.memorialhermann.org/life-flight/

    http://ehealth.eletsonline.com/2013/01/aster-medcity-to-be-commissioned-by-oct-2013/

    http://www.ndtv.com/article/south/new-medical-township-in-kerala-beckons-foreign-health-tourists-442858

    http://www.lalpathlabs.com/future_plans.aspx

    http://www.srlworld.com/content/2/milestones.html

    http://www.medicalbuyer.co.in/index.php?option=com_content&task=view&id=4042&Itemid=48

    Population projection 2021 by National Commission on population 2006 report

    School Education Statistics 2007-08, 20011-12, MHRD

    12th Five Year Plan Documents, Planning Commission Website

    UGC annual report 2011-12

    Newspaper Articles:

    Times of India: http://timesofindia.indiatimes.com/india/UP-Bihar-spend-highest-on-education-in-North-India-Assocham/articleshow/5950212.cms

    Financial Express: http://www.financialexpress.com/news/doubling-higher-education-enrolment-to-meet-target-will-cost-r9.5-lakh-cr-by-2020/944254

    State Education Department websites

    Social infrastructure - A look at enabling elements for growth and development in North India | 32

  • About KPMG in India

  • Social infrastructure - A look at enabling elements for growth and development in North India | 34

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