Constraints to foreign direct investment in Indian hospitals

Rupa Chanda

Document Type

Article

Publication Title

Journal of International Commerce, Economics and Policy

Abstract

This paper examines the impact of a liberalised foreign direct investment (FDI) regime in Indian hospitals on FDI inflows. The paper shows that there is hardly any FDI in Indian hospitals due to domestic constraints such as high initial establishment costs, low health insurance penetration, manpower shortages, high cost of medical equipment, and regulatory deficiencies. These constraints also impede domestic investment in hospitals. The paper concludes that a liberal foreign investment regime may not result in increased FDI inflows if regulatory and structural impediments continue to constrain investment in the host economy. Investment liberalisation must thus be supplemented by domestic regulatory reforms to create an environment that is conducive to all investors.

Publication Date

1-4-2010

Publisher

World Scientific Publishing Co Pte Ltd

Volume

Vol.1

Issue

Iss.1

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