NextBillion - An Initiative of the William Davidson Institute at the University of Michigan

Thursday, September 10, 2015

For nearly two years, Parkway Pantai has delayed the opening of its 450-bed India hospital, the Singapore-based medical firm's bid to cash in on one of Asia's fastest growing private healthcare markets, as it waited for the necessary permits.

Parkway, a unit of the world's second largest healthcare group by market value IHH Healthcare Bhd, now intends to use acquisitions to quickly expand in India, where the private hospitals market is estimated to be worth $55 billion a year but where companies must obtain as many as 70 clearances from federal and local authorities to launch a new facility.

"Greenfield is off the agenda," Ramesh Krishnan, Parkway's head of Middle East and South Asia operations, told Reuters by telephone from Singapore. "It's a market you don't want to wait eternally to tap into, so we've basically decided to do it inorganically. It's just a question of a shorter runway."

In Mumbai, garbage festers around Parkway's already built Gleneagles Khubchandani hospital, which had been expected to open in 2012. Krishnan said it will now open next year.

Expanding through acquisitions has increasingly become the tactic of choice for hospital operators seeking to speedily expand in India, where the demand for private healthcare is booming thanks to an overburdened public healthcare system.