Growth Potential of AYUSH in India
The AYUSH (Ayurveda, Yoga & Naturopathy, Unani, Siddha and Homeopathy) market currently stands at a whopping $10 bn and is projected to see an impressive 50% increase over the course of the next five years. Having no FDI limits, this sector has massive potential for exponential growth, especially in times of public health crises. India is one of the few nations in the world that has an entire ministry dedicated to the research and development of such ‘alternative’ medical practices which ensures efficient fostering of developments that take place in the field. Founded in 2014, the Ministry of AYUSH has taken numerous steps to promote the research and understanding of these practices that are indigenous to India and her history. The ministry has recognized the massive potential for FDI and export in this industry and has cultivated an environment that consists of vast research infrastructure and practice institutions that are at the disposal of both local and foreign investors.
With over 3000 hospitals and 500 colleges dedicated to the proliferation of AYUSH practices, India has emerged as a world leader in this sector of medicine. Multiple wellness parks have been established around the country that stress on the importance of AYUSH practices. These have played a major role in pushing the idea of such medicine into the urban population. Having ancient roots in such practices, the rural population of India has always looked to Ayurvedic home remedies which further strengthens the position of the sector. An almost equal level of penetration in both the rural and urban sectors makes for extremely fruitful returns.
Increase in the budget of AYUSH along with a focus on standardization has furthered this idea. Current market leaders Dabur, Himalaya, Patanjali etc have proved that the success of such medical practices in India is a tried and tested concept with scope for further growth. Moderate market saturation allows for relatively easy market entry which will be facilitated by the high levels of ease of doing business in the country. With a massive population, India provides an enormous local workforce that is young and diverse. India has one of the largest classes of STEM graduates that can be leveraged for research and further development. India, being the second largest exporter of alternative medicine also exports to nations that are beginning to consume these practices at an exponential rate. Yoga, acupuncture and other such wellness practices are gaining immense popularity especially in the developed countries which makes for an even more exciting foray into the market. The global market registered a CAGR of 19.9% over the forecast period at the helm of which is India with a stronghold in both local production and exports. Success in this sector has a spinoff impact on the healthcare and cosmetics industries as well. The demand for non-chemical solutions to various health issues along with skin-care is increasing across the globe and in India. Patanjali, Dabur and other leaders have already made their foray into these industries which has expedited their growth.
India is the world’s 2nd largest exporter of Ayurveda and alternative medicine in the world and is continually promoting its export interests. Given India’s incumbent ancient knowledge and well-developed distribution channels, this export market will only continue to grow due to an increase in demand from international markets. India’s major AYUSH export partners include UAE, Russia, USA, Japan and more many more nations that are diversified across continents. This diversity indicates a growing increase in the curiosity surrounding these practices. The Asia Pacific market which Indian exports already have a strong grip over is expected to rise exponentially over the next 5 years. In addition to this, Latin American and African market are expected to see significant growth which should be looked at areas of opportunity for both Indian AYUSH conglomerates and potential FDI firms looking to take advantage of India’s well-established success in the industry. AYUSH ministry announced in late 2019 the launch of AYUSH research and export council that will focus on the facilitation of India’s export capabilities and will constantly work on the promotion of research and development surrounding the industry. India is one of the only nation that has government sectors dedicated to the promotion of these practices and considering the growth potential of this market, this is truly the best place for FDI.
Unprecedented global emergencies such as the COVID-19 pandemic have long lasting effects on almost all sectors of the economy. Indian alternative medicine giant Patanjali has introduced Coronil, an immunity booster that they claim has shown extremely positive results in helping COVID patients recovers. This is a huge area of opportunity especially in a post-COVID world where people will look to such alternative home remedies that will prevent them from having to resort to allopathic care. Thanks to India’s stronghold in the field of Ayurvedic immunity boosting practices, it is in an extremely strong position to cater to present and future international demand which foreign investors can take advantage of. The government of India has introduced multiple schemes to promote AYUSH activities and has also set up individual research councils for each AYUSH systems which exemplifies its interest in developing this growing industry.
The term ‘alternative’ creates a bubble of stigma around these practices which deems it to be untested and undependable. While these practices are not substitutes to scientific medicine, they do complement the field. Therefore, steps must be taken to destigmatize this idea especially in the western world in order to promote export activities.
Overall, India’s deep-rooted ancient knowledge coupled with its current modern approaches to the development of AYUSH practices make it one of the best destinations to enter or further the industry. An ever growing market coupled with zero FDI limits and government support will make for easy transition. The availability of established infrastructure and skilled man power with incumbent knowledge makes India all the more desirable for FDI. A massive local market with a growing middle class population makes India a lot more desirable. Multiple government schemes that further this cause have been established which creates a lot more credibility in the local market. Increasing demand from India’s top AYUSH export partners namely USA, Japan, UAE and other developed nations ensures stability both locally and internationally.
The blog has been authored by Abhinav Jasthi.
- Confederation of Indian Industry
- Ministry of AYUSH
- Grand View Research
- Transparency Market Research