New Delhi, Dec 13 (IANS) India’s private hospitals segment is estimated to reach $45 billion by 2012 from the present $22 billion with expansion in tier II and III cities, according to an industry report.
“The hospitals segment is estimated to reach a level of $45 billion by 2012 from the present level of $22 billion as leading players in the sector are significantly increasing their investments in tier II and III cities,” said the report jointly prepared by the Associated Chambers of Commerce and Industry (Assocham) and Yes bank.

The contribution of the diagnostic and pathology services to the healthcare industry will touch $2.5 billion by 2012 as against $1.2 billion during 2008-09.

The private sector accounts for 80 percent of India’s healthcare delivery market.

“Investments by private players for tier II and III cities are increasingly getting momentum and with the economic growth in these cities, healthcare sector is expected to rise exponentially,” Assocham president Swati Piramal said.

As per the report, with substantial private equity investments in hospital chains, this large investor appetite will contribute significantly to the spread of private healthcare establishments in rural areas.

“Large corporations have also begun venturing into this highly lucrative business and we expect to see continuity in this trend,” the report said.

The chamber expected to see greater interest from private equity players once significant consolidation in the sector takes place along with the verification of an appropriate India-specific business model.