The Indian healthcare sector is inching towards solidifying and cementing its position as a global powerhouse. The market is expected to stay ahead of the curve in 2025 fuelled by a confluence of factors which include a surge in demand, increased spending, healthcare awareness, affordability , accessibility and a slew of other factors. The expanding horizons of the sector across geographies and increased penetration into underserved regions displays India's vision of achieving health equity by 2030.
From partnerships to collaborations, mergers and acquisitions, a favorite amongst investors, the Indian healthcare sector is expected to pan out as a force to reckon with, in the upcoming year. Indian healthcare has been charting a course of rapid growth,driven by rising health awareness,increased incidence of lifestyle diseases, adoption of digital technologies and investor attraction.Touted as one of the largest sectors in the country, Indian healthcare has been at the forefront of innovation, pivoting India as a powerhouse on the global platform.The outlook for 2025 seems positive and promising with the Indian healthcare market projected to reach $638 billion by 2025 .The upward trajectory of the market is testament to the driving demand for diagnostics, new age therapies and medical devices.
Industry insiders seem hopeful of the sector performing well in the upcoming year. With a core focus on achieving health equity, the sector is expected to layout growth strategies, roadmap to address key on ground challenges ,improved consumer focus and increasing digital integration.
The healthcare sector is expected to have a strong presence in the Indian market in the upcoming year, displaying steady growth backed by a bunch of prospects like increased healthcare awareness, increased spending and improved uptake of health insurance services. The other side of the year for the industry seems bright and promising with the sector projected to grow at a CAGR of 8 per cent in the run up to 2032.
The hospital sector which plays a crucial role in healthcare delivery is expected to also show robust growth in FY 2025.As per a report by ICRA, the aggregate occupancy rate is expected to stay strong at 61-63 per cent in 2025.Profit gains are also expected to hold good at 22 per cent in the coming year. The big gains in the hospital sector will be fuelled by increased occupancy rates and demand for quality healthcare services. Factors like increased per capita income, increased spending power,shifting focus of consumers on quality and speciality healthcare services, and yearly price revision due to inflation will contribute to the average revenue per occupied bed ( ARPOB) that is expected to improve moderately by 4 to 6 per cent. The revenue of the hospital sector is anticipated to touch 12 to 14 per cent fuelled by seamless operational processes, digitisation and cost -effective services.
As per estimates by ICRA , around 4000 beds will be added in FY 2025.The hospital sector is expected to display robust yet stable growth showing a ROCE (return on capital investment) of approximately 14 per cent. In-patient footfalls are expected to maintain a moderate to decent standing,driven by consumer preference for large healthcare facilities due to increased insurance coverage. However average length of stay is expected to stay low due to quick recovery owing to better technological advancements.
Medical tourism footfalls is likely to fair well in the upcoming year, due to the affordable and quality services available in the country. The market currently valued at $7.69 billion is projected to touch $14.31 billion by 2029.As per a study conducted by Bajaj Finserv AMC,10 to 12 per cent of the healthcare revenue is attributed to the medical tourism sector, and the study forecasts that the sector is expected to display double growth in the upcoming year. The governments proactive stand towards extending the outreach of the the e-medical visa facility to 167 countries, will also contribute to the surge in footfalls in 2025.
The pharmaceutical sector is expected to hog the limelight in 2025, displaying an anticipated growth of 9 to 11 per cent. As per a Market growth compass report released by Pharmarack the market is expected to reach Rs 2.38 lakh crore.The tailwinds behind the growth of this sector are driven primarily by innovative launches, novel product launches,ban on sale and manufacture of fixed drug combinations, increased awareness on new therapies and treatments,changing guidelines and regulatory norms of OTC drugs are all expected to contribute to the trajectory of the dynamic pharma market in the year ahead.Vaccine market is expected to decline by 1.8% in the coming year, while in the therapy segments,the cardiac and gastrointestinal segments are projected to display growth of 8.3 per cent and 9.6 per cent. The operating profit margin for 2025 is expected to stay at a stable 22 to 23 per cent (as per ICRA study on a sample set of 25 companies).
As per a report by ICRA , the steady growth of the pharma sector in 2025 will be driven in part by the US market - 9 to 11 per cent, European markets contributing to 7 to 9 per cent and emerging markets contributing to 11 to 13 per cent of the total revenue.
With keen focus on quality and innovation, 2025 will be a year that will see pharma companies expanding their speciality portfolios, diversifying their chronic therapies segments and launching innovative molecules.Industry insiders claim that going forward we can expect advancements in innovation ,specially w.r.t CAR T-cell therapies and m-RNA vaccines that are expected to hit the market the soon.
The medtech space in India is also expected to display robust growth in the coming year. 2025 will witness the medical sector transforming amidst lucrative policies and initiatives by the government to empower the sector to become self reliant and a hub for innovation and manufacturing of medical devices.Touted as the sunrise sector , the medical device industry valued at $11.46 billion is expected to scale heights in the coming year.
The medical diagnostics sector is expected to see a spur in digitisation with laboratories gravitating towards adoption of digital and high throughput technologies to expedite diagnosis and improve patient outcomes. A shift towards digital diagnostics and home testing and self testing kits is expected to see an uptick in the coming year.
The overall sector is anticipated to be on high on performance primarily driven by digital integration and a steady demand in exports. Furthermore the industries upward trajectory will be shaped by mergers and acquisitions, favourable government policies and integration of transformative technologies like AI and data analytics.
Prakash Kumar Guha, Managing Director, Zuventus Healthcare
In 2025, industry participants will focus on joint health, collagen for "beauty from within," and omega-based products for inflammation control.To maintain customer trust and achieve long-term success, the industry must prioritize evidence-based formulations, regulatory compliance, and transparency, especially with the growing emphasis on holistic wellbeing. Stakeholders should leverage scientific research, foster collaborations, and embrace innovation to meet consumer expectations and global health challenges effectively.
Arvind Vaishnav, Head, Philips Innovation Campus and Innovation Partnerships – Growth region, Philips, Bengaluru.
“The emphasis on automation across healthcare is likely to increase as globally, there is a concerted effort towards addressing staff shortages and at the same time relieving staff of repetitive tasks and processes. Needless to say, this will also save healthcare professionals time, allowing them to spend more time with what’s more critical, spending time with patients. We are already witnessing this with generative AI functioning as a virtual assistant, organizing clinical notes and simplifying ways patient information is communicated across teams. It is also now apparent that AI will be adopted beyond automation. It is proven that AI can help simplify complex diagnostics, enabling less experienced professionals to provide high-quality care with confidence. Imagine, AI embedded in ultrasound systems. It allows physicians to detect, diagnose and monitor cardiac conditions more confidently and efficiently.
From a technology perspective, it is also interesting to see how introduction of new technologies in interventional care, minimally invasive procedures are becoming more advanced and hence more common. Having said that, this implies the need for Physicians to collect and analyze data from a wide range of sources, such as live X-ray images, 3D ultrasound, Intravascular Ultrasound (IVUS), to name a few all the while closely monitoring the patient. Hence, integration of systems, software and devices will become increasingly important. This integration allows interventional physicians to treat patients with greater control and confidence during every stage of minimally invasive cardiac procedures.
Vishal Goel, MD, RX Propellant
As India’s life sciences sector looks ahead, it aims to deepen its influence through precision healthcare, biosimilar expansion, and Tier II/III market entry. The expansion will also increase the demand for large-scale campuses that offer plug-and-play lab spaces, clean rooms, and manufacturing facilities. Mergers and acquisitions are expected to accelerate as healthcare providers target underpenetrated regions. Collaboration between public and private sectors, integration of advanced technologies, and India’s cost-effective infrastructure underscore its ability to lead in delivering affordable healthcare solutions. In 2025, aligning with global standards and capitalising on transformative opportunities will help India reinforce its position as a key contributor to advancements in life sciences and global health improvements.
Dr Nageshwar Rao, Cluster CEO, Gleneagles Hospital (Chennai and Hyderabad)
Looking ahead, the hospital sector is poised for growth, driven by increased spending on healthcare infrastructure and digital health. As patient expectations evolve, the focus will be on preventive care, personalized treatment plans, and further leveraging technology for holistic healthcare delivery.With innovation and resilience at its core, the hospital sector is well-positioned to navigate the challenges and opportunities that 2025 will bring.
Smriti Tandon, Co-founder, Online Chikitsa Mitra
2025 promises accelerated adoption of telemedicine and digital health solutions, driven by improved internet connectivity and increased investments in health-tech. Artificial intelligence is expected to play a larger role in early diagnostics and personalized treatment, alongside the growth of community-based healthcare models. Scaling telemedicine e-clinics and launching preventive care initiatives will be pivotal in achieving universal healthcare access, particularly in rural India. Public-private partnerships and innovations to enhance affordability and health literacy will be essential to sustaining this momentum.
Priyadarshi Mohapatra, Founder and CEO, CureBaY
Looking ahead, the health-tech industry is poised for accelerated growth in 2025, with government initiatives like the National Digital Health Mission offering a strong foundation. Projections suggest the sector will reach a $50 billion valuation by 2030, driven by innovations in telemedicine, AI, and personalized diagnostics.
To sustain this momentum, the focus must remain on scaling innovation equitably, fostering collaborations, and building robust infrastructure. The strides of 2024 have laid the groundwork for a transformative era in Indian healthcare, with technology as its backbone.
Mudit Dandwate, CEO and Co-Founder, Dozee
2025 stands as a pivotal year for healthcare transformation, with Health AI poised to drive the next wave of innovation and impact. The growing demand for healthcare services in Tier II cities, coupled with key hospital acquisitions in 2024, signals a significant shift toward decentralising access to quality care. Consolidation within the hospital market and the rapid expansion of hospital bed capacity further underscore the sector’s readiness for large-scale transformation. Additionally, the eldercare and chronic care management markets are experiencing unprecedented growth, fueled by India’s aging population and the rising prevalence of long-term health conditions. Health insurance penetration is on an upward trajectory, though it still offers immense opportunities for expansion.
For Indian startups, the opportunities are immense. The country’s diverse and demanding healthcare landscape serves as a fertile ground for developing solutions that can drive global transformation. While healthcare challenges vary across regions, innovations proven effective in India have the potential to address critical healthcare needs worldwide. The time is ripe for positioning India not just as a participant but as a launchpad for scalable, world-class innovations that can make a significant global impact.
Ravideep Singh, Associate Director, Creative Designer Architects
Looking ahead, I believe India’s healthcare market is poised for transformative growth, but challenges remain. Accessibility and affordability must be prioritized, especially for rural and underserved populations. Investments in digital health and AI-powered solutions will be critical in bridging gaps and enhancing patient care. With the right mix of policy support and innovation, India can emerge as a global leader in healthcare, setting a benchmark for inclusive and sustainable development.
Ishaan Dodhiwala, Co-founder, MediJourn
With rising global demand for affordable yet high quality healthcare in regions like India and Southeast Asia, 2024 has witnessed a boom in the medical tourism industry. This upward trend is expected to further accelerate in 2025, a major catalystic force being the technological advancements in medical devices and healthcare services offered in developing countries.
2025 will be the year of medical tourism, driven by the advancements in cutting-edge technology and the conglomeration of global networks to ensure smoother processes, such as e-visas, tailored insurance packages, and integrated healthcare ecosystems. At MediJourn, we aim to address the increasing need for personalized care and foster international collaboration to empower patients worldwide with accessible, impactful healthcare solutions.
As we look forward, the healthcare industry is slated to scale heights in 2025 with a commitment to advance its healthcare infrastructure ,enhance public health, improve accessibility and affordability. With concerted efforts of its stakeholders, the government and its supportive policies, the healthcare sector is expected to achieve better health outcomes while closing the gap in the urban-rural divide.
