Medical tourism and outward FDI in health services: India in South Asia

Abstract

The medical tourism industry reportedly stood at over US$100 billion in 2012 with 5 to 6 million patients seeking healthcare across borders annually. The sector is also witnessing growing cross-border capital flows. Much of these trade and investment flows occur within regions, Asia being one such region. Within Asia, India is one of the leading exporters of healthcare. Its medical tourism industry was estimated at US$4billion in 2012. India is also an important source of FDI in health services, with leading hospital chains that have overseas presence through subsidiaries and tie-ups. This chapter examines India’s presence as a medical tourism destination and exporter of capital in the South Asian region. It highlights the key characteristics of these exports to the regional market and the main facilitators and constraints. The discussion also touches upon the debate surrounding the positive and negative implications of such flows for India’s healthcare system. The chapter concludes by stressing the contribution health services integration in South Asia can make towards building goodwill and better relations, and India’s importance in this regard. It outlines the various regulatory and infrastructural initiatives that need to be taken by governments and the private sector to make this possible.