Matej Mikulic
Research expert covering health, pharma & medtech
Diagnostics market in India - statistics & facts
In healthcare, diagnostics plays a pivotal role in monitoring, disease diagnosis, and well-being tests. The Indian diagnostics market was valued at about 13 billion U.S. dollars in 2023 and is expected to grow twice its current size by 2028. Some factors responsible for this growth are the rising number of chronic diseases, the aging population, and the increase in the adoption of government insurance programs. Moreover, an increase in health awareness among Indians has resulted in regular preventive health checks.
Furthermore, technological advancement has played a crucial role in terms of accessibility and convenience in the diagnostics market. Diagnostic services are now more accessible even at home because of innovations like telemedicine. This is especially helpful for patients who live in remote areas or have restricted mobility.
The average cost of such diagnostic tests in India is lower in comparison to other developed countries. The cheapest are urine tests, valued on average at just over two U.S. dollars, and the most expensive tests are full-body MRIs, costing more than 380 U.S. dollars. However, this remains a steep price to pay for many domestic patients.
However, the diagnostic market is fragmented and includes standalone centers, private hospitals, and government hospital laboratories. Due to the market fragmentation, the capacity, quality, and scalability of labs may be at risk. However, this fragmentation provides an opportunity for newer business models to evolve. For instance, innovation and competitive pricing in the diagnostics sector are constantly being driven by the entry of new pharmaceutical firms, hospitals, telemedicine providers, and online aggregators.
About three-quarters of the market is based in the urban region, leaving companies to expand to other regions in India. In recent years, this has led to establishing diagnostic services in tier 2 and 3 cities with access to advanced technologies and affordable infrastructure. These cities provide a feasible frontier for diagnostic companies due to the growing population and varying healthcare needs. Besides, the government is prioritizing regulations to improve market efficiency in the near future.
Furthermore, technological advancement has played a crucial role in terms of accessibility and convenience in the diagnostics market. Diagnostic services are now more accessible even at home because of innovations like telemedicine. This is especially helpful for patients who live in remote areas or have restricted mobility.
Segmentation of the diagnostics sector
India's diagnostics market is divided into various segments which reflect the sector’s diversity. Based on the diagnostic test type, the two major segments of the market are pathology and radiology. The pathology market was valued at about eight billion U.S. dollars, with the clinical pathology segment accounting for the highest market size in India. The radiology market was worth over five billion U.S. dollars, with X-rays accounting for the greater parts of the market.The average cost of such diagnostic tests in India is lower in comparison to other developed countries. The cheapest are urine tests, valued on average at just over two U.S. dollars, and the most expensive tests are full-body MRIs, costing more than 380 U.S. dollars. However, this remains a steep price to pay for many domestic patients.
Competitiveness of market players
The diagnostic market in India consists of both unorganized and well-established players. Most well-established players in the market are private companies such as Dr Lal PathLabs, SRL Diagnostics, and Metropolis Healthcare. Moreover, Dr Lal PathLabs is one of the prominent diagnostics chains in terms of revenue and has domestic as well as international presence.However, the diagnostic market is fragmented and includes standalone centers, private hospitals, and government hospital laboratories. Due to the market fragmentation, the capacity, quality, and scalability of labs may be at risk. However, this fragmentation provides an opportunity for newer business models to evolve. For instance, innovation and competitive pricing in the diagnostics sector are constantly being driven by the entry of new pharmaceutical firms, hospitals, telemedicine providers, and online aggregators.
About three-quarters of the market is based in the urban region, leaving companies to expand to other regions in India. In recent years, this has led to establishing diagnostic services in tier 2 and 3 cities with access to advanced technologies and affordable infrastructure. These cities provide a feasible frontier for diagnostic companies due to the growing population and varying healthcare needs. Besides, the government is prioritizing regulations to improve market efficiency in the near future.
