Just before the Covid-19 pandemic hit the world, the Indian government was pushing to make it a US$ 5 trillion economy, promoting business growth, supporting micro, small, and medium enterprise, encouraging youth to start up, and inviting manufacturing in India. The government’s strategy showed results on the ground with big companies like Samsung setting up large manufacturing facilities in the country, the Prime Minister himself promoting the vision of Start-up India, and promising GDP growth was expected for the country.
However, the coronavirus pandemic swung a major blow to these plans, leading to negative GDP growth in 2020-21, and a crippled economy. The silver lining among all this is that India has been able to show signs of promising recovery, and the projected growth rate of over 10 percent in 2021-22, according to the United Nations. If this prediction comes true, India will be the fastest-growing major economy in the world.
While this growth will happen with a positive uptick across the industries, the digital start-up ecosystem is expected to play a major role in this. Particularly, the health and wellness industry, which is still at a nascent stage in India, can contribute strongly to economic growth with the help of digital technology, reaching out to millions of Indians who are now looking for healthy lifestyle options.
The Start-up Ecosystem in India
On August 15, 2015, Prime Minister Modi had announced his Start-up India initiative, a step towards giving a push to the innovation in the Indian start-up ecosystem. This was done to encourage the Indian youth to come forward and use their expertise to create jobs and play a significant role in the Indian growth story.
The digital start-up culture in India has seen steady growth in the last decade with industries like e-commerce, edu-tech, fin-tech, digital payments, etc., becoming a major part of the entire ecosystem. On the other hand, the government has also provided support and necessary boost to the small and medium enterprise in India, promoting the business culture and incentivizing those who are adding to the GDP growth of the country.
Overall, it has created a positive outlook for taking initiative and starting new businesses, especially the digital start-ups which are now revolutionizing the market in India. This growth in the small and medium enterprises, and digital businesses, is bound to have a long-term positive contribution to the economic growth of India.
The Promising Industry Growth
The start-up ecosystem has become a center of focus due to these initiatives in the last few years with the Indian venture capital industry investing over Rs 72,000 crore in the year 2019. This number is 55 percent higher than the preceding year. Today, there are more than 80,000 start-ups in India, and the last year of the pandemic has only increased the reliability of people on digitally available services.
We have all heard about the growth of various digital businesses in the country, but there is a new segment in the market which is now set to become a leading contributor to this growth. The wellness industry is expected to grow at an annual compounded rate of 18.40 percent for the 2019-2024 period. Currently, the industry is valued at an estimated Rs 2,463.49 billion.
Couple this with the overall start-up industry in India which is expected to grow at 12-15 percent annually. A large percentage of these start-ups are technology-driven and given the expected growth rate of the wellness industry in India, we can say that digital wellness start-ups are bound to play a crucial role in this growth story.
NASSCOM report has stated that technology-driven start-ups added 60,000 new jobs in the Indian market in 2019 alone. On the other hand, the start-up India initiative has created over 1,87,000 jobs for the Indian market. These are very promising numbers as job growth in the country is of prime importance today for re-starting the economy after the covid-19 related setback.
Health and Wellness Industry
How can the wellness industry be a part of this growth? There has been an increase in awareness about the need for a healthy lifestyle and maintaining good physical and mental health in the last few years among the Indian youth. The Covid-19 pandemic has only raised this level of awareness as everyone is today realizing the importance of building a strong immune system to fight the diseases, and to have positive mental health to sail through a crisis.
All this has focused everyone’s attention on health and wellness services like yoga, meditation, diet-planning, aerobics, etc. The government, at the same time, has also been promoting a culture of healthy living through initiatives like Fit India, International Yoga Day, and AYUSH ministry. At the same time, the direct impact of a pandemic on outdoor activities and the need of following physical distancing have severely impacted the offline health industry.
However, this has also opened new opportunities as the offline businesses are now moving online to provide their services digitally, while new start-ups are entering the market connecting the customers with experts who can help them in their journey towards health and fitness.
What to Expect?
Overall, India can still aim for its US $ 5 trillion economy goal with the help of technology-led start-up industry growth. The second wave of Covid-19, which hit the country in May has led to increased fear around the disease, and the expected third wave has only ensured that people are now choosing to stay indoors as much as possible.
This means everyone is spending more time on the internet and using it for communication as well as consumption. It can be expected that the Covid-19 pandemic and its effects are here to stay in the long run, and therefore, the changes that have happened to the businesses, especially in the form of adopting technology and moving to digital platforms, are going to stay.
In addition, we cannot expect that these effects will immediately evaporate once the situation comes back to normal. It is going to have a long-term impact on consumer behavior, and this means that digital industries and technology-driven start-ups are going to play a stronger role in the GDP contribution of the country.
Therefore, focusing on capable technology-driven industries like health and wellness, which directly impacts the whole population and has the potential of being accepted by the urban as well as rural population, can prove to be a game-changer. The vision of an Atmanirbhar Bharat can be achieved by supporting the indigenous businesses and this will, in turn, help the country grow.
- This article is written by Sanjeev Singhai, Founder, Wellnessta.