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 ®ULATORY 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
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