Panel seeks review of FDI in private hospitals, warns of aggressive corporatisation, rising healthcare costs
Foreign capital should be encouraged in the manufacture of medical devices, consumables and specialised medicines for rare diseases, while its application in the direct operation and acquisition of hospitals needs greater scrutiny, the report by the Parliamentary Standing Committee on Health and Family Welfare says
A parliamentary committee has called for a review and rationalization of Foreign Direct Investment (FDI) limits governing private hospitals, warning that aggressive corporatisation and the influx of foreign capital could raise healthcare costs and compromise medical affordability. The committee expressed concern that foreign investment in private hospital chains is enabling larger corporations to acquire mid-sized facilities, transforming healthcare into a purely capitalistic enterprise and potentially increasing the cost of medical procedures.
While the report suggested encouraging foreign investment in the manufacturing of medical devices, consumables, and specialised medicines for rare diseases, it called for stricter scrutiny of foreign capital's role in the direct operation and acquisition of existing hospitals. The committee recommended that the government strictly review and rationalise FDI limits concerning hospital operations and acquisitions, creating incentives to redirect foreign investment towards domestic production of medical technologies and pharmaceuticals.
They also proposed that a robust public healthcare system act as a market regulator, providing an affordable alternative to private care, and that efficiently managed public hospitals exert competitive pressure on private providers to lower healthcare costs. The panel stressed that private and foreign capital should complement rather than replace public investment in healthcare, with incentives tied to affordability, geographical access, and services for vulnerable populations.
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