The medical tourism industry reportedly stood at over US$100 billion in 2012 with 5 to 6 million patients seeking healthcare across borders annually. The sector is also witnessing growing cross-border capital flows. Much of these trade and investment flows occur within regions, Asia being one such region. Within Asia, India is one of the leading exporters of healthcare. Its medical tourism industry was estimated at US$4billion in 2012. India is also an important source of FDI in health services, with leading hospital chains that have overseas presence through subsidiaries and tie-ups. This chapter examines India’s presence as a medical tourism destination and exporter of capital in the South Asian region. It highlights the key characteristics of these exports to the regional market and the main facilitators and constraints. The discussion also touches upon the debate surrounding the positive and negative implications of such flows for India’s healthcare system. The chapter concludes by stressing the contribution health services integration in South Asia can make towards building goodwill and better relations, and India’s importance in this regard. It outlines the various regulatory and infrastructural initiatives that need to be taken by governments and the private sector to make this possible.
This chapter highlights the close links between demography, trade and migration and the consequent implications for trade in services through the temporary cross-border movement of labor. In the wake of current and prospective demographic imbalances between nations, mode 4 trade in services can be a useful avenue for addressing labor market shortages and skills deficits, with mutual benefit to both sending and receiving nations. However, the effective realization of these opportunities is constrained by barriers to mode 4 in importing countries and by limitations in the supply capacity of sending countries. This chapter argues that host countries need to take steps to ease border and ‘behind-the-border’ measures that currently impede the entry and stay of foreign workers while source countries also need to pay greater attention to the supply side challenges affecting mode 4 exports, through education and training policies, labor market policies and supporting institutional frameworks. The discussion stresses the fact that without greater attention to capacity and quality issues in sending countries, the latter will not be able to leverage their demographic surpluses and will also face tradeoffs between exporting services through mode 4 and meeting their domestic labor market needs. Moreover, their demographic dividends then risk becoming a demographic liability. In addition to unilateral measures, both sending and receiving countries also need to actively pursue bilateral labor agreements as well as broad-based economic cooperation and partnership agreements that cover services, investment and labor mobility, so as to benefit from their demographic complementarities.
The service sector has witnessed a significant increase in cross-border trade and investment flows. This globalisation has been driven by a variety of factors, including advances in information and communication technology, rising income levels and associated increases in the demand for services, opening up and deregulation of many services permitting the entry of domestic and foreign private providers, and demographic imbalances between countries. Globalisation of services has in turn provided countries with new development opportunities and with new avenues for realising economic and welfare gains, but it has also thrown up many challenges and dilemmas for governments and international institutions. This chapter pulls together the body of existing and emerging work on the globalisation of services and its implications for development.