Ayurveda Industry Market Size, Strength and Way Forward
Ayurveda Industry Market Size, Strength and Way Forward
Ayurveda Industry Market Size, Strength and Way Forward
Ayurveda
Industry
Market Size,
Strength and
Way Forward
1
Copyright © 2018 by Confederation of Indian Industry (CII), All rights reserved.
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Table of Contents
List of Abbreviations
List of Tables
List of Figures
List of Boxes
1. Introduction 1
1.1 Definitions and Coverage 1
1.2 Methodology Adopted 3
1.3 Governance Structure and Initiatives 4
4. Ayurveda Services 11
4.1 Medical Manpower 11
4.2 Hospitals, Dispensaries, Clinics and Pharmacies 15
4.3 Wellness Centres and Spas: Solely Ayurveda or Ayurveda as a
Major Component 21
The Issues 32
References 38
Appendix A 39
List of Abbreviations
AIIA All India Institute of Ayurveda
FY Financial Year
HS Harmonised System
IQ Institutionally Qualified
UK United Kingdom
US United States
Table 4: Export and Import of Medicants and Medicaments during 2008-09 and 2017-18 27
Table A1: List of NABH Accredited Ayurveda Hospitals in India as of July 2018 36
List of Figures
Figure 1: Comparing Definitions of Different Wellness Products 3
Figure 6: Coverage of Ayurveda Hospitals and Dispensaries per Ten Million People 17
List of Boxes
Box 1: About the Patients : Primary Survey 18
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Ayurveda Industry Market Size,
Strength and Way Forward
According to the Ministry of Ayurveda, Yoga & Naturopathy, Unani, Siddha and Homeopathy
(AYUSH), “Ayurveda” is made up of two words-Ayuh and Veda. Ayuh means life and Veda
means knowledge or science. Thus “Ayurveda” in totality means ‘Science of life’. It incorporates
all aspects of life whether physical, psychological, spiritual or social.5 In India, the practice of
Ayurveda as a system of medicine has been recognized under the Indian Medicine Central
Council (IMCC) Act 19706; education of Ayurveda is regulated by a statutory body known as
Central Council of Indian Medicine (CCIM)7 and the Drugs & Cosmetics Act 19408 regulates
manufacturing and sales of Ayurveda drugs.
As per the Indian Government’s Make in India initiative (launched in September, 2014), Ayurveda
is part of the ‘Wellness’ industry. Over the years however, the Wellness industry has evolved
to include other dimensions of physical, emotional and mental well-being.9 According to the
Ministry of Statistics and Programme Implementation (MoSPI)’s National Industrial Classification
(NIC), the Government classifies Ayurveda under industries. There are two broad industry
categories under which activities related to Ayurveda fall. First category is the manufacture of
`ayurveda’ or `unani’ pharmaceutical preparation (code 21003 under division 21, manufacture
of pharmaceuticals, medicinal chemical and botanical products) and the second category
comprises of activities of Ayurveda practitioners (code 86901 under division 86, human health
activities).10
When it comes to Ayurveda products, there is confusion regarding the description and
differentiation between Ayurveda, Natural, Organic and Herbal products. While they all are largely
a part of the wellness industry, there are differences in their meaning and coverage. Certain
private companies11 have tried to bring out the different elements of each (see Figure 1).
For the purpose of this paper Ayurveda includes (a) Ayurveda product manufacturing and
allied activities and (b) services. Ayurveda services include hospitals, clinics, wellness centres
and spas; pharmacies; Ayurveda practitioners; education and research institutes; telemedicine
and online Ayurveda services; among others. Trade in Ayurveda goods includes trade of
Ayurveda products, machineries, raw materials, herbs, and intermediate products. Trade in
Ayurveda services will involve cross-country mobility of practitioners and patients; Indian
hospitals establishing presence in foreign countries and foreign hospitals establishing presence
in India, on-line Ayurveda consultancy with foreign patients, etc. Since Ayurveda is a form
of medical practice most players in this sector are organised. However, there are overlaps
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Ayurveda Industry Market Size,
Strength and Way Forward
between the sector and other sectors, which makes it difficult to estimate the size of the
sector. For example, herbs, which are inputs into Ayurveda medicines, can also be used for
cooking and other purposes
1.2 Methodology Adopted
This report is based on secondary data analysis and a primary survey of different stakeholders
in
the sector. Secondary data on Indian Ayurveda industry is largely available from the
Government sources, with the Ministry of AYUSH being the key repository of data. Trade data
is available from the Department of Commerce and data on foreign investments is available
from the Reserve Bank of India and Department of Industrial Policy and Promotion. Apart from
these Government sources, there are private estimates on the size of the market, employment
and growth potential, etc.
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Ayurveda Industry Market Size,
Strength and Way Forward
The Government has been undertaking steps to promote the Indian Ayurveda industry and other
wellness services, particularly at the administrative level. Consequently, in November 2014, the
Department of Indian System of Medicine and Homeopathy was elevated to an independent
ministry. The Ministry of AYUSH was thus formed to ensure the optimal development and
propagation of AYUSH systems of health care. National Health Policy (2017)13 acknowledges
the pluralism in the Indian health sector, wherein traditional and modern medical practices co-
exist. The policy focuses on mainstreaming the potential of Indian traditional medicine, including
Ayurveda. Health is a part of 12 Champion Services Sectors identified by the Department of
Commerce, Government of India.
In addition, as per the National Health Policy, 2017, mainstreaming the potential of AYUSH
is one of the priorities of the Government. The policy ensures access to AYUSH through co-
location of public facilities. It also recognises the need to standardise and validate Ayurveda
medicines and establish a robust and effective quality control mechanism for drugs. The policy
also suggests leveraging digital tools for generating and sharing information about AYUSH
systems. Thus, Indian medicinal systems such as Ayurveda are getting a policy boost in the
country, which is likely to further accelerate the growth of the industry.
It is worth mentioning that given the emerging global and domestic demand for Ayurveda
products and healthcare services, in October 2017, theAIIA14 was established as an autonomous
organisation under the Ministry of AYUSH, Government of India. It is a centre of excellence
and is conceived as an apex institute for Ayurveda, which brings together both Ayurveda
healthcare as well as training and education for the same.
12 For details see Annual Report 2017-18, Ministry of Ayurveda, Yoga & Naturopathy, Unani, Siddha and Homeopathy (AY-
USH) accessible at http://ayush.gov.in/sites/default/files/Ayush%20AR%202017-18-8.pdf (accessed on July 3, 2018).
13 The document is accessible at http://cdsco.nic.in/writereaddata/National-Health-Policy.pdf (accessed on July 3, 2018).
14 See http://www.aiia.co.in/aboutus.html (accessed on August 12, 2018)
4
Size of the Market
2.1 Existing Projections
There are both Government and private sector estimates on the size of Indian Ayurveda industry
and wellness sector. These are largely scattered and one-time estimates of the industry size
and growth potential. Some of the estimates are as follows:
¾¾ According to Statistics MRC, the Global Ayurveda Market is accounted for USD3.428 billion
in 2015 and is expected to reach USD9.791 billion by 2022 growing at a compound annual
growth rate (CAGR) of 16.2 per cent from 2015 to 2022.15
¾¾ According to Confederation
• Accounted for USD3.428 bn in 2015
of Indian Industry ( CII) 16, Global Ayurveda • Projected to reach USD9.791 bn by 2022
in the year 2016, the total Industry • Growing at CAGR 16.2% from 2015 to 2022
estimated market size of Indian • Estimated size of USD3 bn in 2016
Ayurveda industry is USD3 Indian Ayurveda • Product market accounts for 75%, remaining
billion, which includes both Industry are services
Ayurveda products (ethical, • Projected to grow by 16% by 2021
classical, over the counter • Estimated size USD13.9 bn in FY2015
Indian Wellness • Expected to grow at CAGR of 12% over the
(OTC), personal care and
Industry next 5 years
beauty products) and services • Likely to create over 3 mn jobs
(medical, well-being, payor
and medical tourism services). The product market is larger – USD2.27 billion (75 per cent
of the total market) compared to the services market (USD0.75 billion). The industry is
envisioned to grow to reach USD9 billion by the year 2022. According to another estimate,
the Ayurveda market is expected to go from USD2.5 billion to USD8 billion by 2022.17 It
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Ayurveda Industry Market Size,
Strength and Way Forward
Roughly, three things can be concluded. One, Ayurveda is a small but growing part of the
overall Indian wellness industry. Two, India is the largest and the most important player in
the global Ayurveda market. Three, the sector is projected to grow at a fast pace. However,
none of these studies try to provide a comprehensive estimate of the sector encompassing
both secondary data and primary survey. This report attempts to fill the lacuna and also to
layout the methodology for future data collection, which will enable to understand the size
and enormous contribution of the sector through backward and forward linkages.
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Ayurveda Industry Market Size,
Strength and Way Forward
Services – 30
3. Hospitals Around INR 1000 crores Over 50
4. Day Care Treatment Centre, Around INR 5000 crores Over 50
Clinics, Dispensaries, etc.
Note: T
here are several data gaps. For example, wellness is a large and growing sector but there is no data
for this sector. This makes it difficult to estimate the size of this sector.
7
Manufacturing and
3.
Allied Sector
Most of the large companies in the Ayurveda sector are in manufacturing. According to the
estimates provided by the Ministry of AYUSH, there were 8667 units in AYUSH manufacturing
in 2016-17, out of which 7435 units were into Ayurveda products. Most of these companies are
small and medium sized and only around 50 companies have revenue above INR 100 crores
in 2016-17. These 50 companies account for over 85 per cent of the revenue generated by this
sector. According to Ayurvedic Drug Manufacturers Association (ADMA), which has around 9000
members, 99 per cent of their members are MSMEs (micro, small and medium enterprises).
According to industry estimates, top 50 companies (across both food and Ayurveda non-food
products) reported revenue of around INR 22,500 crores for the financial year April 2017-March
2018 from sale of Ayurveda products only. Within this, the size of the natural/Ayurveda veterinary
and feed supplement market is estimated to be INR 700 crores, with nearly INR 150 crores
of exports (around 95 per cent of exports are in herbal feed supplements while around 5 per
cent are in Ayurveda veterinary medicine according to industry estimates).
The sector is privatized and there is no official data on total production, volumes of sales
generated, and employment contribution of this sector. Some of the large product manufacturing
companies (with over INR 1000 crores turnover) include Dabur India, Himalaya Herbal
Healthcare, Baidyanath Group, Emami Group, Hindustan Unilever Limited and Patanjali Ayurved
Limited. Some companies offer both products and services (for example, Jiva Ayurveda, Kairali
Ayurvedic Group and Patanjali Ayurved Limited). For many wellness companies, 75 per cent
of the revenue is from services and around 25 per cent is from products.
A pilot survey conducted by CII shows that companies operate across different product
segments – from, medicine to food supplement and cosmetics (see Table 2)
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Ayurveda Industry Market Size,
Strength and Way Forward
Products Companies/Manufacturer
Drugs/medicine for human The Arya Vaidya Pharmacy (Coimbatore) Ltd, Arya
consumptions - Classical Ayurveda Vaidya Sala Kottakkal, SNA Oushadhasala Pvt. Ltd.,
products without any variation of Dhootapapeswar Prakashan Private Limited, Dabur India
formulae or ingredients Limited
Drugs/Medicines for Human The Arya Vaidya Pharmacy (Coimbatore) Ltd.;
Consumptions - Proprietary Arya Vaidya Sala Kottakkal
Cosmetic and Spa Products Kama Ayurveda
Kairali Ayurvedic Group
Rajah Ayurveda
The Arya Vaidya Pharmacy (Coimbatore) Limited
Himalaya Global Holdings Limited
Food Products Aravindh Herbal Labs (P) Limited, The Arya Vaidya
Pharmacy (Coimbatore) Ltd
Food Supplements Sri Sri Tattva, Dabur India Limited
Ayurveda Veterinary Medicines Ayurvet Limited, Ayursun Pharma, Himalaya Herbal
Healthcare, Vamso Biotech Private Limited, Natural
Remedies, etc.
Wellness Products Kairali Ayurvedic Group, Forest Essentials, Patanjali
Ayurved Limited
Ayurveda Agro-inputs Swaroop Agrochemical Industries, BICCO Agro Products
Private Limited
Ayurveda Machinery and AVP Treatment Equipments Enterprises [(an unit of the
Equipment Manufacturers Arya Vaidya Pharmacy (Coimbatore) Limited)],
Dhroni Ayurvedas, Poornimas Panchakarma Equipments
and Consultancy services, India Medico Instruments
Note: T
here are several data gaps. For example, wellness is a large and growing sector but there is no data
for this sector. This makes it difficult to estimate the size of this sector.
The survey highlighted that most Ayurveda products are not patented. Ayurveda is treated as
traditional knowledge and the Traditional Knowledge Digital Library (TKDL) of the Ministry of
AYUSH provide a list of around 82,90023 Ayurveda medical formulations and around 1150 herbs
registered under TKDL. According to the National Medicinal Plants Board, Ministry of AYUSH,
Ayurveda, Siddha and Unani systems of medicine have more than 90 per cent formulations
which are plant based. India has a natural advantage in manufacturing Ayurveda products as
over 7000 indigenous herbal plants grow in the country.24 However, the data on raw material
availability is outdated. According to the official data, domestic demand for medicinal plants
was estimated to be 1,95,000 MT for the year of 2014-15 and the total consumption of herbal
raw drug in the country was estimated at 5,12,000 MT. Around 22 per cent of the production
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Ayurveda Industry Market Size,
Strength and Way Forward
was sourced through cultivation.25 Unless recent data is collected and collated it is difficult to
estimate the raw material availability and demand.
With rise in demand for Ayurveda products, the survey found that there is a shortage of raw
materials. The Ministry of AYUSH acknowledges the need to have more robust data and in-
depth information on state-wise cultivation of different medicinal plants and identification and
prioritization of medical plants for development and cultivation through various subsidy and
other Government programmes, among others. There is a need for data and information
collection on companies’ manufacturing herbal extracts and intermediate products, list of drug
testing laboratories and R&D institutes and research centres.
While a number of companies have registered their products in India and abroad, most of the
products are registered in India. In India, food products/supplements are registered with Food
Safety and Standards Authority of India (FSSAI). Medicines are regulated by the Departments
of AYUSH. Animal feed supplements are classified based on usage and are not regulated
for licensing purposes. However, the products have to follow Legal Meteorology guidelines
pertaining to labelling and claims. Thus, there are variations across products in terms of
regulations and processes.
The pilot survey of manufacturers conducted by CII shows that many manufacturers have
developed well-known brands which are sold in domestic market and abroad. To ensure
quality, they take common certificates such as WHO-GMP (World Health Organization - Good
Manufacturing Practices), ISO 9000 and HACCAP (Hazard Analysis and Critical Control Points)
certifications. When asked about how companies decide to produce organic, natural vis-a-vis
Ayurveda products, most companies produce as per the market demand. With a growing
demand for organic products a number of manufacturers have moved into this segment.
The positioning of the product across different markets depends on various factors including
consumer choice and Government policies. For example, in most developed countries including
the United States (US) and the United Kingdom (UK) most Ayurveda products are positioned
as food supplements.
10
Ayurveda Services
4.
The Ayurveda services sector encompasses medical manpower, hospital, dispensaries and
pharmacy, use of information communication technology, education services, wellness services,
etc. Some of these are discussed below:
Focusing on the available data for practitioners per ten million people, as of
January 1, 2017, there were about 3,221 Ayurveda practitioners per ten million
26 For example, websites such as Ayurved Doctors and on-line directories such as Justdial, provide a list of doctors state-
wise and/or city-wise by illness that they treat. Patients can also get a review of the doctors from such sources.
27 http://ayush.gov.in/genericcontent/ayush-india-2017-0 (accessed on July 10, 2018).
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Ayurveda Industry Market Size,
Strength and Way Forward
Source: Data extracted from Ministry of AYUSH, accessible at http://ayush.gov.in/genericcontent/ayush-
india-2017-0 (accessed on July 10, 2018).
people in India. While the number has increased over the last five years,
however, if one looks back at a longer timeframe, there has been a decline
in the number of Ayurveda practitioners perten million people in the country.
For instance, in 2009 there were 4,159 Ayurveda practitioners per ten million
people, which was lower than the year 2000 when there were 4252 Ayurveda
12
Ayurveda Industry Market Size,
Strength and Way Forward
Figure 3: State-wise and Gender wise Distribution of Total Ayurveda Practitioners
as of January 1, 2017
Note: Blue bars, namely in the case of Arunachal Pradesh, Bihar, Himachal Pradesh and Maharashtra
represent the total number of practitioners are given without the gender distribution due to unavailability
of information. There is no data for the states/union territories omitted from the chart.
Source: Data extracted from Ministry of AYUSH, accessible at http://ayush.gov.in/genericcontent/ayush-
india-2017-0 (accessed on July 10, 2018).
Ayurveda practitioners (see Figure 4). Overall, in the year 2017, the share of
IQ Ayurveda practitioners is more than the NIQ Ayurveda practitioners.
Figure 4: Distribution of Ayurveda Practitioners as per their Qualification
Source: D ata extracted from Ministry of AYUSH, accessible at http://ayush.gov.in/genericcontent/ayush-
india-2017-0 (accessed on July 10, 2018).
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Ayurveda Industry Market Size,
Strength and Way Forward
In the past three years, there has been an increase in demand for Ayurveda
treatment, which has created a demand for medical practitioners, nurses and care
workers. There is need for more comprehensive survey to identify the demand-
supply gaps, which can help to design policies to support this sector.
4.1.2 Nurses
As regards the total number of nurses, as of December 31, 2016, there were
2,877,138 registered nurses in India, which included 841,081 auxiliary nurse
midwives (ANM), 1,979,718 registered nurses and registered midwives (RN and
RM) and 56,339 lady health visitors (LHV). Some of the states with the largest
number of nurses include Tamil Nadu, West Bengal, Andhra Pradesh, Kerala
and Karnataka. Thus, the southern states in India have greater concentration
of nurses.
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Ayurveda Industry Market Size,
Strength and Way Forward
nurses, care workers, certifying agencies, quality control bodies, some foreign
Government approval’s agencies, etc.
The Ministry of AYUSH collects data on hospitals and dispensaries from state
Government agencies. As of April 1, 2017, there were about 3,186 Ayurveda
hospitals and 17,416 Ayurveda dispensaries. The total number of AYUSH
hospitals on the same date was 3,943 and the number of dispensaries was
27,698. Thus, in terms of medical care facilities, Ayurveda has the highest
share among all AYUSH systems (around 80 per cent) compared to others
such as Unnani, Siddha and Homeopathy. It has increased remarkably since
the year 1980, when it was around 60 per cent of all AYUSH medical care
facilities. An increase in the share of Ayurveda facilities has been matched
by a corresponding fall in the share of Unani and Homeopathy medical care
facilities.
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Ayurveda Industry Market Size,
Strength and Way Forward
Source: D
ata extracted from Ministry of AYUSH, accessible at http://ayush.gov.in/genericcontent/ayush-
india-2017-0 (accessed on July 11, 2018).
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Ayurveda Industry Market Size,
Strength and Way Forward
in the trend since then. In 2017, there were 43,274 beds in Ayurveda hospitals
reported by the Government.29
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Ayurveda Industry Market Size,
Strength and Way Forward
Discussion with the Ministry of AYUSH confirms that the above data does not
comprehensively cover private hospital and polyclinics. There is a need for
more in-depth research to know the size of the sector, revenue earned, growth
potential, infrastructure availability and requirements, type of illnesses treated,
patients profile, cost of treatment, etc. and this will require a comprehensive
survey of the available facilities. The CII survey found that most of the polyclinics
are privately-owned while dispensaries are primarily Government-owned or
supported. There were around 26,000 dispensaries as of April 2017. The
ownership and modes of operations of private hospital and clinics vary. They
can be profit making or owned by a charitable trust. There can be standalone
Ayurveda hospitals or such facilities can collocate within an allopath hospital
[for example, All India Institute of Medical Sciences (AIIMS) have an Ayurveda
centre] or with other AYUSH facilities. Recently, the All India Institute of Ayurveda
(AIIA) was set up in the lines of AIIMS, which would do R&D and treatment.
Under the National Health Mission there is a possibility of creating 20,000
co-location facilities, 646 co-location facilities in district hospitals and 510 in
public sector enterprises. The discussions further highlighted that there are
different types of clinics that are coming up. These includes on-line/tele-clinic,
mobile clinic (clinic in a mobile van), boat clinic, etc.
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Ayurveda Industry Market Size,
Strength and Way Forward
The illness for which a patient comes for treatment to an Ayurveda facility varies across
hospitals and clinics. Some common illnesses for which patients seek ayurveda treatment
include different forms of bone related illnesses, arthritis, asthma, cough and allergies,
headaches and sinusitis, ophthalmology, gastrointestinal diseases, skin diseases,
gynaecological disorder, diabetics, lifestyle and metabolic disorder (obesity, thyroid, etc.),
depression and neurological disorder. The cost of treatment on an average is around INR
2800 per day in out-patient care and INR 8000-12,000 per day if the patient is admitted to
the hospital. Most of the hospitals maintain a record of patient’s illnesses and get regular
feedbacks from patients which help to improve service quality.
4.2.2 Pharmacies
Available information shows that within the overall AYUSH system of medicine,
Ayurveda pharmacies occupied the largest share (around 85 per cent). On April
1, 2017, there were about 7,698 Ayurveda pharmacies in India out of which
only 33 (0.4 per cent) were managed by the Government and the remaining
7,665 (99.6 per cent) were managed by non-Government bodies. Further, 88.9
per cent of the Ayurveda pharmacies followed good manufacturing practices
while the remaining 11.2 per cent did not.
Over the years, there has been a varied trend in the number of Ayurveda
pharmacies and the total number of AYUSH system pharmacies (see Figure
7). However, Ayurveda pharmacies have always held the highest share in the
total AYUSH system pharmacies in India, which has remained in the range
of 80-90 per cent. Rather, the share has increased from 80 per cent in 1995
to about 85 per cent in 2017.
As of April, 2017, among states, Uttar Pradesh (19.6 per cent) has the highest
number of Ayurveda pharmacies, followed by Maharashtra (10.16 per cent),
Kerala (9.69 per cent), Madhya Pradesh (8.82 per cent), Gujarat (6.88 per
cent) and Haryana (5.81 per cent), among others. In majority of the states,
most pharmacies follow good manufacturing practices (GMP). Only in a few
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Ayurveda Industry Market Size,
Strength and Way Forward
Figure 7: Number of Ayurveda and AYUSH System Pharmacies in India (1995-2017)
Source: Data extracted from Ministry of AYUSH, accessible at http://ayush.gov.in/genericcontent/ayush-
india-2017-0 (accessed on July 11, 2018).
states/UT such as Arunachal Pradesh, Assam, Jharkhand and Puducherry, the
pharmacies following non-good manufacturing practices (non-GMP) are more
than those following GMP. There are other states such as Bihar, Jammu and
Kashmir and Maharashtra where there are either equal or slightly less than
equal number of pharmacies following non-GMP (see Figure 8).
Figure 8: State-wise and Manufacturing Practice-wise Distribution of
Ayurveda Pharmacies in India as of April, 2017
Source: Data extracted from Ministry of AYUSH, accessible at http://ayush.gov.in/genericcontent/ayush-
india-2017-0 (accessed on July 11, 2018).
To meet the growing demand, support and inclination towards Ayurveda
products, there is need for licensed Ayurveda pharmacies that follow good
manufacturing practices for manufacturing Ayurveda drugs.
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Ayurveda Industry Market Size,
Strength and Way Forward
The Ministry of Tourism, Department of AYUSH and NABH has set up a process for
accreditation of wellness centres. It is a voluntary programme and a “Mark of Excellence”
is provided to the accredited centres which is expected to give confidence to the
tourists and locals that the centres are providing services as per global standards and
by credentialed staff (qualified and trained) and rights of customers are protected.30
The Government has also come with guidelines for promotion of wellness and medical
tourism.
The National Health Policy(2017), accords high importance to primary healthcare and
highlights that primary healthcare facilities, which provides a package of services
including geriatric health care, palliative care and rehabilitative care services which can
be referred to as ‘health and wellness centres’. Thus, wellness centres have received
special attention from the Government in the recent past and are largely linked to
primary care. The policy also has a vision to provide ‘health for all’ and universal health
coverage and to achieve this, the Government conceived ‘Ayushman Bharat’ (Healthy
India) scheme. Under this scheme, one of the components is to have 1.5 lakh health
and wellness centres in the country by 2022 to bring health care closer to people.
These centres will provide Comprehensive Primary Health Care (CPHC) covering both
maternal and child health services and non-communicable diseases, including free
essential drugs and diagnostic services.31 Thus, primary care, which is also an essential
component of Ayurveda in India, has received new impetus from the Government.
The survey found that some of the companies (for example, Kairali Ayurvedic Centre)
have a number of centres across multiple countries including Japan, Mauritius, United
Arab Emirates (UAE), Thailand, Bulgaria, Czech Republic under different operating
models such as Franchisee-Owned Company-Operated (FOCO) and Franchisee-Owned
Franchisee Operated (FOFO). A wellness centre with around 20 branches has around
100 full-time employees in total. The average cost of treatment is INR 2500, but the
costs vary by packages, diseases and span of treatment.
While most wellness centres do not have stay facilities a number of centres are now
creating stay facilities. The major treatment for which consumers visit wellness centres
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Ayurveda Industry Market Size,
Strength and Way Forward
include weight management, pain management, stress management, skin care treatments
and Detox treatment. The survey found that around 95 per cent of patients in wellness
centres for day treatment are Indians while around 80 per cent of foreigners come to
stay in wellness centres from Europe, Japan, the US and rest of the world for treatments
like Panchkarma, Detox and Sukha Chikitsa (wellness treatment).
22
Reaching out to
5.
Consumers
With technological developments, the CII survey found that Ayurveda products and services are
reaching out to consumers in a variety of ways. The products can be positioned as medicines
or food supplements or food products. They can be accordingly sold through Ayurveda
specific pharmacies, general pharmacies, store and non-store (on-line and social media)
retail formats. Ayurveda products are sold through both organised/formal and unorganised/
informal retail formats. Of late, sale of Ayurveda products through e-commerce is increasing. A
manufacturer can position his/her products as Ayurveda, herbal/natural or organic depending
on the market demand. The market demand is growing for all these categories and there is
a tough competition among them.
A number of companies are using technology to provide Ayurveda services and some of them
provide both products and services. For example, although primary business of Jiva Ayurveda
is services, they also manufacture products. They have 250 doctors and 150 support staffs
and 80 physical clinics but majority of their service is through telemedicine where a patient
can call and connect with an Ayurveda practitioner. They receive calls from around 6000
patients per day out of which 75 per cent are call-back patients (i.e. those who have taken
the treatment before). A key component of their service is education services where they
digitalise Indian traditional books and literature and provide knowledge to people. They also
own facilities for Ayurveda treatment.
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Ayurveda Industry Market Size,
Strength and Way Forward
and wellness industry in the country. Ayurveda reaches out to consumers across all income
groups. According to a report32; one in four Indians risks dying from a non-communicable
disease before reaching the age of 70 years. All these factors are leading to an increased
demand for natural therapies in the country. According to another study, Ayurveda has a
major role in Indian healthcare system and occupies a share of 70 per cent in the formal
drugs market (Bulsara and Yadav, 2018). The market is likely to grow further. According to
Deshpande (2015), the demand for herbal products worldwide has increased at an annual
rate of 8 per cent during the period of 1994–2001, and based on a WHO report, the paper
highlights that the global herbal market would be worth USD5 trillion by the year 2050. The
paper further highlights that out of the thousands of units in the sector, only around 35 have
sales of INR500 million. Thus, the demand scenario is promising.
There are various studies looking at the consumer behavior towards Ayurveda products and
services. Most of these studies focus on a particular city/district in the country. For instance,
Rajani (2016), based on a survey of 50 respondents in Palakkad district of Kerala using
structured questionnaire highlighted that a majority of the respondents consider Ayurveda as
a better system of medication over Allopathy, Homeopathy, Unani and others. Out of the total
respondents, around 96 per cent were regular customers of herbal products. Ayurveda products
were purchased due to factors such as goodness and popularised by word-of-mouth.
Based on a review of secondary literature, Bulsara and Yadav (2018) found that in Gujarat,
there is a preference for traditional medicines over allopathic treatment due to the preventive
and curative nature of medication. Further, it is highlighted that while the traditional system of
medicine takes time, it does not have any side effects. Greater awareness is being generated
about Ayurveda products.
Another study (Arya, et. al. 2012) conducted in Joginder Nagar region of Himachal Pradesh
using a structured questionnaire with 500 respondents found that 64.8 per cent of the
respondents preferred Ayurveda medicines over allopathy, homeopathy and Unani. It is also
considered reliable by majority of the respondents. Many of the respondents (around 77 per
cent) were habitual consumers of Ayurveda products for ailments like common cold, allergy
and cough, among others. Most of the consumers consume these medicines without Doctor’s
prescription and often these are consumed with allopathy and homeopathy medication. It is
worth mentioning that the region where the survey was conducted is located in the north-east
corner at an average 3,314 feet, located in the north-western ranges of the Himalayas and
thus is fairly remote.
As regards recommendation for furthering the growth of Ayurveda products, a study by Lakshmi,
et. al. (2017) conducted using semi-structured questionnaires with 202 patients in Tamil Nadu
found that most patients look for quicker response from medicines and thus, companies in the
sector should invest resources on developing Ayurveda medicines with quick response. Further,
there is a need for better visual marketing and campaigns to increase public awareness. This
will also assist in mainstreaming Ayurveda.
32 See http://economictimes.indiatimes.com/news/politics-and-nation/25-of-indians-may-die-of-lifestyle-diseases-before-
they-are-70-study/articleshow/48463055.cms (accessed on August 24, 2018)
24
International Trade
6.
and Investment Flows
6.1 International Trade
Ayurveda trade includes trade in both Ayurveda products (goods) and services.
25
Ayurveda Industry Market Size,
Strength and Way Forward
These two are covered under the broader heading of Pharmaceutical Products
(HS30).
India’s major trading partners for export and import of Ayurveda products
are varied.
27
Ayurveda Industry Market Size,
Strength and Way Forward
export of medicaments were Nepal, UAE, Russia and the US, among others
(see Figures 10a and 10b).
Source:
Compiled from Department of Commerce website accessible at http://commerce-app.gov.in/eidb/
default.asp (accessed on September 6, 2018)
Thus, the secondary data shows that trade is still a small proportion of India’s
Ayurveda market and it is concentrated in a few export destinations and
import sources. India’s trade in Ayurveda products did slow down for a few
years, however, over the last couple of years it has picked up again. The in-
depth meetings with Ayurveda manufacturing companies highlight that only
10-15 per cent of the products or 1-2 per cent of manufacturing by volume
is exported as Ayurveda products. Similarly, only 1-2 per cent of the products
are registered in foreign countries as drugs and sold through pharmacies.
Most products are exported as food supplements or health supplements to
markets such as the US and the UK.
28
Ayurveda Industry Market Size,
Strength and Way Forward
Among the different Ayurveda companies, Jiva Ayurveda has entered into an
international partnership through education. The company has trained foreign
coaches from countries such as Japan and France who in turn spread Ayurveda
through schools such as Jiva Japan School. The Kripalu Center for Yoga &
Health is an example of how AYUSH is reaching international markets.
29
Ayurveda Industry Market Size,
Strength and Way Forward
Source: Medical Tourists Flocking to India, The Hindu, July 23, 2018; Medical Value Travel in India: Enhancing
Value in MVT by FICCI and IMS Health India, accessible at http://www.ficci.in/Medical-Value-Travel-Report.pdf
(accessed on August 24, 2018); Indian Brand Equity Foundation.
30
Ayurveda Industry Market Size,
Strength and Way Forward
As regards India’s outward investments in Ayurveda industry, the data is sketchy. Data on
India’s overseas investments is available from the Reserve Bank of India (RBI) website. The
RBI publishes monthly data for broad sectors of investments, which does not explicitly mention
Ayurveda industry. However, a closer look at company-wise data reflects information for some
of the large Ayurveda companies that have made invested abroad.
Some of the top investors are – Dabur India Limited, which has invested about USD207.6 million
in UAE since July 2007; Siddhayu Ayurvedic Research Foundation, which has invested about
USD11.6 million in Indonesia and UAE since July 2007; Kerala Ayurveda Pharmacy Limited,
which has invested about USD10.7 million in the US and Germany since July 2007. Most of
the investments are made in the manufacturing sector. Other investors include companies such
as Ayurvedic Natural Healthcare Centre Private Limited, Shahnaz Ayurveda Private Limited,
Vaidya Sane Ayurved Laboratories Private Limited, Santhigram Ayurvedic and Spiritual Resort
Private Limited and Patanjali Ayurved Limited, among others.
The growth of trade and investment flows will depend on the demand for Ayurveda globally.
The CII survey found that Ayurveda can be registered and legally practiced in Gulf Cooperation
Council (GCC) countries and countries such as Mauritius. Russia and Myanmar also accept
traditional Indian medicine. It is recognised in all SAARC countries except Pakistan and
Afghanistan. In the US, where Ayurveda is yet to be recognised as a medical practice and drugs
needs FDA (Food and Drug Administration) registration, Ayurveda practices is popularised as
wellness and products are sold as food and health supplement. An US based start-up named,
Curejoy, adopted social media to spread the concept of Ayurveda by providing information
on healthy living. The company reaches out to 100 million people each month through social
media platforms and works with a set of experts, including Ayurveda doctors, nutritionists and
health coaches to promote healthy living. Around 40 per cent of their consumers are in the
US, 25 per cent in India and remaining are spread across other countries. They have setup
manufacturing units for health supplements in the US and are planning to expand to India.
Thus, companies are exploring innovative ways to spread Ayurveda in global markets.
A number of hospital chains are planning to expand to countries such as the US, Russia
and GCC. They pointed out that they need financial support from the Government to build
awareness about this form of practice. The Government may also work with other countries
to get the Ayurveda doctors registered which will allow them to practice. These are discussed
in more details in policy recommendation section.
31
The Issues
7.
• Lack of Data: The core issue faced in estimating the size of the sector, its contribution
to the GDP, employment, and its socio-economic impact is the data gap. There is no
official source of data on (a) Ayurveda manufacturing sector, (b) private hospitals, clinics,
wellness centres and spas, (c) employment generated and manpower requirements (d) raw
material availability and requirements (f) trade in Ayurveda services and (e) consumers of
Ayurveda. Unless such data is collected and collated, it is difficult to get a comprehensive
analysis of the size of the sector, project its future growth and showcase the sector in
global platforms.
• Shortage of Manpower: The survey found that there is a shortage of manpower and
skilled professionals (doctors, paramedical staff, therapists and nurses) in this field. Further,
there seems to be a lack of Government approved and/or recognized paramedical training
courses and there is no uniformity in the skill and knowledge. A number of companies
offer training to develop skills like therapists.
• Product Classification: Product classification depends on usage and the products can
be classified as Ayurveda products or food supplements. Accordingly, companies are
registered with both Ministry of AYUSH and FSSAI.
• Shortage of Quality Raw Materials: All the companies in manufacturing sector pointed
out that there is a severe shortage of certain kinds of medicinal plants/herbs, because
they are either becoming endangered or there can be lower production due to factors
such as adverse weather conditions. For example, variable production of Amla may lead
to fluctuation of rates or its non-availability. Further, there are wide variations in quality of
raw materials. There is no Government approved standards for intermediate products and
herbs and this has resulted in wide variety in standards. If pesticides are used by farmers
above the maximum residue limit specified by some markets such as the US and the
EU, the products/herbs can get rejected. As per Drugs and Cosmetics Act, raw material
should comply with the quality specifications of Ayurvedic Pharmacopeia of India, which
is a legalised document of the Government of India describing the quality, purity and
strength of selected drugs that are manufactured, distributed, and sold by the licensed
32
Ayurveda Industry Market Size,
Strength and Way Forward
• Variable Quality Standards of Manufacturing Units and Services: There are wide
variations in quality standards of hospitals, manufacturing units, wellness centres. This is
a cause for concern of service providers who are trying to implement international best
practices. According to survey participants, 40 per cent of the manufacturers do not have
WHO-GMP certification.
• Product Patents and R&D Related Issues: Most Ayurveda products are not patented as
Ayurveda is treated as a traditional knowledge. This makes it difficult to have proprietary
rights on the drugs. There is limited funding for R&D in this area.
• Lack of Product Traceability: Product traceability is essential for exports and unless
traceability is implemented patients are at a risk. Unless product traceability and standards
are implemented manufactures pointed out that it is difficult for them to export.
• Variation across States in terms of Ayurveda Policy. There are variations across states
with respect to their support for Ayurveda. For example, as shown in Table 5 in some
states Animal Husbandry Departments do not include Ayurveda/Herbal products for their
purchases and only tender for chemical products.
S No States which Buys Herbal Products States which do not Buy Herbal Products
1 Assam Kerala
2 Arunachal Pradesh Tamil Nadu
3 Andhra Pradesh Gujarat
4 Telangana Maharashtra
5 Karnataka Madhya Pradesh
6 Haryana Rajasthan
7 Himachal Pradesh Chhattisgarh
8 Jammu & Kashmir Punjab
9 West Bengal UP
10 Jharkhand Uttarakhand
11 Goa Bihar
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Ayurveda Industry Market Size,
Strength and Way Forward
S No States which Buys Herbal Products States which do not Buy Herbal Products
12 Orissa Manipur
13 Tripura Meghalaya
14 Sikkim Mizoram
15 Pondicherry (UT) Nagaland
• Issues in Registering Poly Herbal Formulation Abroad: In most of the countries, there
is no provision to register poly herbal (more than one herb) formulations. Most Indian
Ayurveda Products have multiple herbs. Some countries have registration rules for products
containing single herb/essential oils. This creates barriers for exports of Ayurveda animal
health products. Further, many Indian medicinal plants are not registered/approved for
use in many countries, creating barriers for product approvals.
• Non-recognition and Degree and Traditional Medical Practice: This is a major barrier
to export of Ayurveda services, especially medical practitioners. According to the survey
participants there is a huge demand for Ayurveda doctors, care givers or Ayurveda
wellness consultants outside India but most of the Indian certifications are not valid. Since,
an Ayurveda doctor can only practice as an Ayurveda consultant in most countries, it
adversely impacts their earning potential.
• Sector-specific issues: The recent natural disaster in Kerala has adversely affected
the wellness and spa sector in the state. Some hospitals, clinics and dispensaries have
pointed out that due to high demand, their ability to accommodate and treat patients is
getting saturated and there is need for funding for fast expansion.
34
Recommendations
8.
and Way Forward
The high growth of the Ayurveda sector in the recent years has been possible due to the
continued support of the Government, especially the proactive measures taken by the Ministry
of AYUSH. The industry will continue to grow if some of the concerns listed above can be
addressed. These are:
• Have a Robust System of Data Collection: To support the growth of the industry, it
is important to identify the data gaps, understand the needs and requirements of the
private sector, understand the socio-economic contribution of this sector, among others.
For promoting “brand Ayurveda” in domestic market and global platform the Ministry
of AYUSH needs to have a more robust database, which can be generated through a
comprehensive survey of all stakeholders. The Ministry needs to regularly collect data on
the growth performance of the sector, raw materials and manpower availability, barriers
faced in goods and services exports, etc. While there are shortages of certain medicinal
plants, the survey found that some species which had earlier become endangered can
now be cultivated. Data on raw materials and intermediary products will be required to
sustain future demand. Data will help the Government to take informed policy decisions.
In this regard, since majority of the sector is privatised, the Ministry of AYUSH may form a
consortium partnership with industry associations such as CII and research organizations
to collect, collate and present data on the sector.
• Formulate a Short-term and Long-term Vision Document: While the Government has
supported the industry through various initiatives, the sector will attract more investment
and create more jobs if the Government comes up with a short (five-year) and long-term
(10 year) vision document. In formulating the vision document, the Government can work
closely with the industry and industry associations to design policies that will help the
industry to become productive and competitive.
• Promote and Globalise Ayurveda: The Government can work jointly with the industry
and its associations to globalise “Brand Ayurveda” and increase awareness of this
system of practice through G20 and other multinational fora. Specifically in the G20, the
Government may work with like-minded countries to promote traditional medicines and
remove barriers to their exports.
35
Ayurveda Industry Market Size,
Strength and Way Forward
• Focus on Quality and Standards: It is important for the Government to focus on quality
and standards of the manufacturing units, service providers, treatment procedures, raw
materials used and manpower engaged in this sector. The Government needs to work
closely with the industry to design standards for raw materials. Tax incentives and other
measures may be given to help the industry in upgrading standards. The industry may be
encouraged to invest in R&D through liberal tax incentives or soft loans. The Government
may work with the industry to implement a system of product traceability. It may also
work with industry to ensure protection of traditional knowledge. It is important to draw
up a list of laboratories which meet international standards and share it with the industry.
The Government may also establish best practices or standard guidelines for evaluation
of clinical trials.
• Promote Exports: A number of measures can be taken to promote exports. First, the
Government can support the businesses by organising promotional events, workshops,
seminar, etc. in other countries which will create awareness of Ayurveda and this will
also help to develop medical tourism in India. The Government may work with other
countries to address concerns related to registration of poly herbal (more than one
herb) formulations and come up with a process of harmonisation of drug registration
requirements. Since a number of players in this sector are small and mid-sized industry
the Government can share more information on how they can register their products or
practice in other countries. The Government can provide support for R&D and for meeting
36
Ayurveda Industry Market Size,
Strength and Way Forward
quality standards for exports. In order to promote exports, COPP based on WHO-GMP
may be expanded to include non-herbal ingredients such as Bhasmas.
• Policy Uniformity across States: Policy uniformity across states and support of the state
Governments are essential for this sector to grow. The Ministry of AYUSH can identify
and share the best practices across states.
• Focus on Human Resource: As the sector grows there is a shortage of human resources
and it is important to invest in well-trained and motivated human resources. The industry
may work with Ministry of AYUSH and National Skill Development Corporation India
(NSDC) to identify the skill gaps and training needs in the sector. It is also important to
understand what requirements need to be fulfilled to make the Indian degrees acceptable
in some key countries (accordingly the curriculum may also be revised).
• Support through Insurance Policy and Coverage: Ayushman Bharat Yojana or National
Health Protection Scheme has recognised Ayurveda to be covered under insurance.
However the industry needs more clarity as to how it will be implemented. A clear guideline
may be provided in this respect.
37
References
Arya, V., Thakur, R., Kumar, S. and Kumar S. (2012), “Consumer Buying Behavior towards Ayurvedic
Medicines/Products in Joginder Nagar – A Survey”, Ayurpharm - International Journal of Ayurveda and
Allied Sciences, Vol.1, No.3 (2012) Pages 60 – 64.
Bulsara, H.P. and Yadav, N. (2018), “A Study on the Current Scenario of Consumers Buying Behavior
towards Ayurvedic Medicines in Gujarat”, IOSR Journal of Business and Management (IOSR-JBM), pp 31-
35, Presented at the 2nd International Conference on ‘Innovative Business Practices and Sustainability in
VUCA World’, Organised by GNVS Institute of Management – Mumbai in April – 2018.
Confederation of Indian Industry (CII) and Frost & Sullivan (F&S) 2017, “Vision 2022 Roadmap for Indian
Ayurveda Industry”, Prepared for Ministry of AYUSH, 2017.
Deshpande, S.M. (2015), “Study of Current Market Scenario & Marketing Prospects against Changing
Attitude of Consumers towards Buying of Ayurvedic Medicines in India”, International Journal of Business
and Management Invention, Vol. 4, Issue 6, pp. 48-54, June 2015.
Federation of Indian Chambers of Commerce and Industry (FICCI) and Ernst & Young (EY) (2016), “Value
Added Services-Wellness and Preventive Healthcare”, FICCI 9th Annual Health Insurance Conference,
December, 2016 accessible at http://ficci.in/VAS-Report.pdf (accessed on September 1, 2018).
Lakshmi, K.S., Jasim, K.M., Prabhakar, K. and Parveen S.J. (2017), “Brand Positioning of Ayurvedic
Medicine in Indian Milieu”, International Journal of Business Excellence, Vol. 11, No. 1, pp. 16-37.
Rajani, P. (2016), “Consumer Perception towards Ayurvedic Products with Special Reference to Megha’s
Herbo Care Ayurvedic Pharmacy, Varode, Palakkad”, International Journal of Commerce, Business and
Management (IJCBM), Vol. 5, No.6, pp. 7-15, Nov-Dec 2016.
Techsci Research (2016), “India Ayurvedic Products Market by Product Segment (Ayurvedic Healthcare
Products and Ayurvedic Personal Care Products), by Organized vs. Unorganized, Competition Forecast &
Opportunities, 2011 – 2021”, Techsci Research, July 2016 accessible at https://www.techsciresearch.com/
report/india-ayurvedic-products-market-by-product-segment-ayurvedic-healthcare-products-and-ayurvedic-
personal-care-products-by-organized-vs-unorganized-competition-forecast-opportunities-2011-2021/726.html
(accessed on September 1, 2018).
World Health Organization (WHO) (2010), “Benchmark for Training in Traditional/Complementary and
Alternative Medicine: Benchmark for Training in Ayurveda”, World Health Organization, 2010.
38
Appendix A
9.
Table A1: List of NABH Accredited Ayurveda Hospitals in India as of July 2018
39
Ayurveda Industry Market Size,
Strength and Way Forward
40
Ayurveda Industry Market Size,
Strength and Way Forward
41
CII Contacts
Contributor
Dr Arpita Mukherjee
Professor
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Relations (ICRIER)
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Fax : 91 11 2462 0180
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