Can Indian Healthcare sector achieve AtmaNirbharta?

By Rudrani Ghosh

How self-sufficient is the Indian healthcare system with manufacturing, research, and development, production of raw materials, and equipment?

In 1959, while addressing the convocation ceremony in Indianapolis, the then-senator of Massachusetts John F. Kennedy eloquently declared that “The Chinese use two brush strokes to write the word ‘crisis’, ‘ One brush stroke stands for danger; the other for opportunity. In a crisis, be aware of the danger— but recognize the opportunity.”

Cut to 61 years later. While emphasizing on his “AtmaNirbhar Bharat Mission” on May 2020, Prime Minister Narendra Modi propounded that the coronavirus pandemic must serve as a pivotal point to turn crisis into opportunities and create “a self-reliant India”.

The COVID-19 pandemic has highlighted the challenges; which though not easy to mitigate, it surely provides an opportunity to bring about long needed change in healthcare delivery in India. Thus, the obvious question that comes to mind is how self-sufficient the Indian healthcare system is with manufacturing, research, and development, production of raw materials, and equipment.

Opportunity to bolster the Healthcare Workforce

There is a shortage of healthcare providers at every level in the healthcare sector. The density of the total health workforce is estimated to be 29 per 10,000 population, but it is only 16 per 10,000 for trained workers. In that case, no doubt, if AtmaNirbhar Bharat: Make in India comes into effect, it will boost India’s socio-economic development. However, for the success of this proposal, it is necessary to provide sufficient resources to build and develop a vast network in the field of health care.

“You cannot have AtmaNirbhar Bharat without having adequate human resources," says Dr. Navneet Bali, Director, Northern region of Narayana Health. He further points out that “the shortage of the healthcare workforce is acute at the postgraduate level." The limited number of postgraduate seats (No. of pass-outs of MBBS students each year is 80055 vs the number of post-graduation seats for the 2020-21 academic session is 44000) reveals the gap between supply and demand.

Dr. Akash Rajpal, Executive Vice President, Medikabazaar, is also of the similar opinion that “the biggest challenge is to enable the supply of the healthcare workforce which could be done through the adoption of some liberal policies where the existing colleges might increase their seats multiple times, and the rigid requirements of infrastructure to run a medical college can be abolished so that the smaller institutions can start teaching students in a lesser cost.” Agreeing to Dr. Rajpal’s views, Dr. Vivek Desai, Founder, HOSMAC India, also calls for smaller institutions to allow training to postgraduate students. In the same breath, he adds, "the incorporation of cross-functional training where the doctor can also take up a dual degree, vocational training for healthcare providers will boost up the quality of care – this will also enable more research and development.”

However, the government has seriously started taking into account the shortfall of human resources and “in the 6th August, the Medical Council of India Board of Governors (MCI BOG) in collaboration with the government have given recognition for the 2-year post-graduate broad-specialty diploma courses (such as in anesthesiology, Obstetrics and Gynecology, Pediatrics, Family Medicine, Ophthalmology, ENT, and TB & Chest Disease)  under the guidance of the National Board of Examinations, which will facilitate to bring in additional specialists in the healthcare system to bridge the gap especially in the remote areas,” adds Dr. Bali.

Hospital Infrastructure: Towards AtmaNirbharata

The COVID fear has made patients move from the traditional caretaking approach to the virtual healthcare space. According to Dr. Desai, "India has hardly about 1 bed per 1000 population and we need to triple out that by making it at least 3 “asset-class” beds per 1000 population. Also, we should not call a bed a bed until it has minimum standards (For instance, in North-East the number of beds is pretty high, but the quality of that asset is very poor). To create an asset-class infrastructure, we need a huge investment to make India AtmaNirbhar.” 

“Although, there is a requirement for more beds, it won't be utilized without appropriate medical staff which again boils down to the fact that there is a need for a radical change in the medical education system to enable the creation of doctors and nurses to effectively provide care,” says Dr. Akash Rajpal.

Thus, in this present scenario, government and private players have to come together to make India self-sufficient. Dr. Bali asserts that “we need to look at models in which more private players and corporate hospitals are given chance to operate in Tier 2 Tier 3 hospitals, but that will only happen when the policy changes or hospitals are given incentives to go and work in those areas.”

Boosting Raw Materials along with Healthcare Security

Although the Indian pharmaceutical industry is regarded as the "Pharmacy of the World", it is very much inclined towards the imports from China (close to 67%) for its raw materials and other active pharmaceutical ingredients (APIs).

Until the 1980s, India was self-reliant in producing pharma raw materials domestically. However according to CII KPMG report, owing to the cheaper cost of production (close to 30%), low electricity cost (close to 20%), higher labor productivity (1.5x higher), and other financial and logistical costs (close to 30% less), the manufacturing infrastructure of India was shifted to China. The other important aspect that requires immediate attention is the chemical sector which also reverberates the same sentiment. The chemical industry is a primary provider of raw materials for the pharma industry. In contrast to China’s domestic production (which accounts to ½ the total chemical sector), India constitutes of 1/3rd of the total sector, which reflects that more emphasis should be provided on domestic production, resulting in some APIs to be cheaper than China.

"With the current turn of events, pharmaceutical companies are going to get a great boost in India. Although there will be a little increase in price, it is in the long due to being corrected. In addition, the insurance companies’ increase in the penetration to pay rather than the customers' out of pocket, will create an opportunity for the pharmaceutical sector of India to relook and rebuild," explains Dr. Rajpal.

Medical Device Sector has posed Challenges

The clarion call of Prime Minister Modi to become AtmaNirbhar has posed a huge challenge on the highly import-dependent medical device sector. Experts suggest that the key challenges faced by the medical device industry during the pandemic and sudden lockdown include supply chain issues, operational challenges, policy changes, and limited indigenous capacities.

The med-tech companies have recognized a sudden decline in demand for products related to joint replacements, implantable devices, and bariatric surgeries, while the demand for ventilators, PPE, diagnostic kits is on the rise. Med-tech companies need to be flexible and agile to meet the demands of services and products once the situation normalizes.

‘Make in India’ in the med-tech sector can be achieved through designing strong robust innovative solutions. In the current context, there exists a single regulatory framework for pharma and med-devices which requires immediate attention to transit it into two different departments and policies.

“The government has to work very hard to start a new revolution in manufacturing chip capability in India with technology transfer agreements to make India self-reliant in the med-tech space,” remarks Dr. Rajpal, “The lack of chip manufacturing as a whole also needs to be strengthened which is an essential component in Med-tech space. India should change the definition of manufacturing – till 100% of the production is done in India, only then people will be conscious, otherwise, India will become a glorified assembly unit. Although India lags far behind in the med-tech space, we can quickly adapt if we enable certain policies to attract just the top global 40 Med-tech companies as they account for more than 60% of the required medical devices to start manufacturing in India.” He further adds, “Government can ensure the success of Make-in-India project by working closely with the Med-tech companies and incentivizing them to manufacture in India to improve and scale-up supply chain ecosystem, market adoption practices, and skill creation to be a net exporter in time to come.”