India’s healthcare industry is not just an essential pillar of national well-being; it is also a high-impact economic engine. With the private sector catering to over 70% of India’s patients, it forms the backbone of service delivery, innovation, and infrastructure. The sector has attracted nearly $30 billion in investments in recent years, making it one of the most dynamic and promising areas for long-term growth.

Yet, beyond capital and capacity, what truly determines the future of healthcare is the ecosystem in which it operates.

However, as healthcare delivery becomes more complex and technology-driven, regulatory frameworks must evolve in parallel. When compliance becomes fragmented, duplicative, or unpredictable, it increases the cost of care, slows expansion, and diverts critical resources away from patient outcomes. Reducing regulatory friction is therefore not merely an industry demand—it is a national imperative to ensure accessible, affordable, and high-quality healthcare for all.

Today, India stands at a pivotal moment. Encouragingly, we are seeing a growing spirit of partnership between policymakers, healthcare organisations and federations as we work together to build a stronger, future-ready healthcare system. Meaningful reform is only possible when government and industry collaborate with a shared commitment to improving care for every citizen.

A Heavily Regulated Sector

Healthcare is among the most regulated sectors in India, governed by over 28 central and state authorities and subject to more than 6,500 compliance requirements. A typical healthcare facility may be required to comply with nearly 29,000 obligations annually, including maintaining over 1,500 records and securing close to 1,400 approvals.

Adding to this complexity is the constantly shifting regulatory landscape, with nearly 25–30% of regulations undergoing changes each year. This unpredictability creates uncertainty for investors, delays project execution, and escalates compliance costs.

While regulation is essential for patient safety and quality assurance, excessive overlaps, inconsistent interpretations, and fragmented processes often divert time, resources, and focus away from what matters most: patient care and innovation.

The need of the hour is not deregulation, but smarter regulation—one that safeguards patients while allowing providers to grow responsibly and efficiently.

Regulatory Ambiguity in Diagnostics: A Critical Gap

One of the most pressing challenges lies in the diagnostics sector, which remains caught between unregulated expansion and overregulation. Diagnostics laboratories face conflicting requirements under clinical establishment laws, biomedical waste rules, and local municipal regulations. There are also inconsistent licensing norms across states and unclear applicability of judicial rulings, leading to legal uncertainty.

This is particularly concerning because diagnostics is the foundation of preventive healthcare. If we want India to move from illness to wellness, from late-stage treatment to early detection, we must create a clearer and more supportive regulatory framework for this vital sector.

The Hospital Height Constraint: A Case in Point

Another example of outdated regulation is the restriction on hospital building height under the National Building Code of India (NBC) 2016, which caps hospital structures at 45 metres, despite no such limitation for residential or commercial buildings.This limits optimal land utilisation and forces horizontal expansion in land-scarce urban areas. All this eventually increases capital expenditure due to duplication of infrastructure and manpower.

Revisiting such norms, with robust safety safeguards, will ensure that India’s cities can build healthcare capacity for the future in a sustainable and cost-effective manner.

Unlocksustainably and cost-effectively

A focussed regulatory overhaul can simultaneously uphold standards and promote ease of doing business, unleashing the sector’s full potential.Some key steps include harmonising state and central licensing frameworks, introducing greater transparency and defined timelines for approvals, expanding single-window digital clearance systems, recognising global quality certifications to reduce duplication, simplifying environmental and safety compliance, modernising infrastructure norms, creating a dedicated medtechregulatory framework, and bringing clarity to ethical marketing practices.

But beyond operational efficiency, the true impact of smarter regulation lies in what it creates for citizens.

Importantly, this is not about deregulation. It is about building a thriving healthcare ecosystem where patients can trust the system, where quality is consistent, and where minimum standards are assured across the country. When trust is strengthened, patients do not feel the need to repeat tests, seek multiple opinions out of doubt, or worry about variability in care and quality. This is how we build a healthcare system that serves people better, faster, and more fairly.

Towards a ‘Heal in India’ Ecosystem

If India gets regulatory reform right, the outcomes will be transformational. We will not only enable Indian healthcare providers to scale with confidence but also strengthen India’s position as a global healthcare destination. Heal in India must not only be a promise for Indian citizens, but also for the world—where global patients come to India with trust, knowing they will receive quality care, ethical diagnostics, and consistent standards.

The Indian government’s intent and willingness to engage with the sector at this critical juncture is deeply commendable. If we continue this collaborative path, we can build a healthcare ecosystem that is trusted, future-ready, and globally competitive.

(The author is President, NATHEALTH; and Promoter & Executive Chairperson, Metropolis Healthcare Ltd. Views are personal.)