'India revenue to touch $1billion in 2 years'

Indian Market A Lab To Understand Customer's Needs, Says GE Healthcare Systems Chief Thomas Gentile, president and CEO of GE Healthcare Systems, flagship business of GE Healthcare, was in India recently to review operations, "super-charge" the product development programmes and meet customers. The head of $13-billion unit of GE Healthcare, which manufactures diagnostic imaging devices (X-rays, ultrasound machines, CT scanners) and life care systems (ECG machines and ventilators), tells TOI's Rupali Mukherjee that the Indian unit will soon touch billion-dollar revenue. Excerpts from an interview:

What's the purpose of your visit? 

The focus of this trip is really India though I was in Bangladesh a day before. India for us is a very big market with huge growth potential. It's already a big market - we do close to $500 million in sales today, and in a couple of years will soon be billion-dollar market. And with 1.2 billion people, the potential is even bigger than that. So there's no doubt that India is on our global radar scene.

What are the products developed in India, and for the domestic market? 

We have already developed 14 products in India, for India. Some of these are also being exported to global markets. Products like MAC 400 - a portable ECG device, is being exported to nearly 100 countries; lullaby baby warmers and phototherapy solutions go to about 70 countries; Vivid P3 (cardiac imaging ultrasound system) and a number of ultrasound systems goes all around the world. We have three new solutions ready to roll out in the next few weeks addressing maternal/infant health. We have nearly 40 solutions in the pipeline targeted to release over the next two-three years addressing ventilation, radiology, cancer, life sciences, and the most prominent is a series of PET/CT molecular imaging system targeted to release by first half of 2013. These CT (computed tomography) devices are expected to reduce costs by 40%, and enhance the access to early detection facility of cancer.

What are the specific needs of the Indian market, and GE's strategy here?

The idea is to use the engineers here to see what are the specific needs of the Indian market and how do we meet them. The devices have to meet the price point, include all the features, have a small footprint and in certain cases, be suitable for rugged conditions. India is an interesting market for us globally, as its all private pay - customers pay themselves. Prices, therefore, have to be extremely competitive - it's one of the most extremely competitive markets in the world. Indian market is actually a laboratory to see what consumers want, and what they are willing to pay for. People here demand quality healthcare at lowest possible costs and it helps bring the right behaviour and a healthcare model. And it also calls for specific innovations in terms of technologies and business models.

Also, it's just not cost which is a criteria, but space too, because space is at a premium here.

How does India fare in the Asian region?

GE Healthcare operates in seven regions - US, Europe, Latin America, India, China, Asia-Pacific, and Middle-east and Africa. India is identified as a key region for growth. India contributes 20% of overall Asia revenues. Though India's revenue contribution to overall GE Healthcare is small, it is improving and we are targeting to reach $1 billion over the next couple of years. In addition to that, the capability that we have here is extremely important. We have 4,000 engineers in Bangalore working on product development - their product development is not just for the Indian market, but important for our global supply chain. We also do quite a bit of manufacturing in India for several of our product lines.

GE recently moved its X-ray business to China. How does the company view India and its capabilities?

Both China and India have tremendous engineering capabilities, and are growing at high rates. The comparison ends there. China is a bit more mature in the sense of as it is a bigger market than India. Healthcare purchases are done heavily by the government. Like western countries, there is reimbursement and insurance penetration is better. However, India is very different. Insurance penetration is very low and there is no government reimbursement. Healthcare is driven largely out of pocket and offers a very interesting dynamic - consumerism.

We have plenty of investments in both the countries. GE Healthcare spends an average of $50 million every year on R&D for healthcare solutions in India. We have large R&D centres in both countries, the one in India being the largest in the world with about 4,000 people and 1,200 people focusing only on healthcare solutions. China, India and Europe are now handling roughly one-third of all development work outside the US now.