India’s burgeoning healthcare sector is on the cusp of a technological revolution driven by artificial intelligence (AI), as highlighted by recent industry reports. According to a comprehensive study conducted by Nasscom and Kantar, the AI segment within India’s healthcare market is anticipated to grow at an impressive compound annual growth rate (CAGR) of 40.6 percent, reaching an estimated $1.6 billion by 2025. This growth trajectory reflects the sector’s rapid adoption of advanced technologies aimed at enhancing healthcare delivery and management.
The Indian healthcare industry, valued at approximately $650 billion, has experienced a robust growth rate of 22.5 percent CAGR from 2016 to 2022. The sector is witnessing significant diversification in products, services, and market reach, driven by both technological advancements and an increasing demand for quality healthcare.
The transformative potential of AI in healthcare is immense. AI technologies are poised to revolutionize various facets of the healthcare ecosystem, from improving diagnostic accuracy and streamlining operational efficiencies to advancing personalized patient care. Predictive analytics powered by AI can foresee disease outbreaks, while precision medicine enables treatments tailored to individual genetic profiles.
Achyuta Ghosh, Senior Director and Head of Nasscom Insights underscores AI’s significance in healthcare, stating that AI holds transformative potential in healthcare, from predictive analytics for disease outbreaks to precision medicine tailored to genetic profiles. To completely harness this potential, India must capitalize on AI infrastructure, skilled professionals, and adaptive regulatory frameworks.
According to a recent survey by Nasscom, AI adoption within the healthcare sector is rapidly gaining momentum. In the pharmaceutical and life sciences verticals, 82 percent of surveyed organizations have implemented AI on a small scale and plan to expand its use in 2024. Notably, 12 percent of these organizations have already integrated AI into their core operational processes. Healthcare providers are also increasingly embracing AI, with 68 percent of providers having adopted the technology. However, it is worth noting that a significant majority—92 percent—of these deployments are currently in the proof-of-concept (PoC) phase. This indicates that while the interest and investment in AI are high, many implementations are still in the early stages of development and evaluation.
Large technology firms are leveraging platform-based approaches and hybrid cloud solutions to develop scalable and compliant healthcare applications. These approaches are crucial for managing the complex data needs of healthcare systems and ensuring that AI applications are both effective and secure.
Generative AI, a rapidly evolving subset of AI technology, is also making inroads into the healthcare sector. Despite its nascent stage of adoption, with 34 percent of healthcare organizations piloting at least one or two Generative AI use cases in 2023, the potential for this technology is substantial. Generative AI can facilitate innovations in medical research, drug development, and patient engagement.
Ghosh emphasizes the importance of addressing data privacy, security, and ethical considerations to maintain public trust. “Ensuring data privacy, security, and ethical guidelines is crucial for maintaining public trust. By embracing AI, India can set a global standard for healthcare innovation, driving growth and enhancing the quality of life for millions,” he asserts. AI technology continues to evolve, it promises to significantly impact the Indian healthcare sector. By investing in advanced AI infrastructure, cultivating a skilled workforce, and establishing robust regulatory frameworks, India can unlock the full potential of AI and establish itself as a global leader in healthcare innovation.
