Learn how to Start a Healthcare Diagnostic Business in India

India’s healthcare industry is growing at a staggering pace. By the end of FY 22, as per the estimates by The India Watch, India’s healthcare industry is set to reach USD 349.1 billion, jumping significantly from USD 272 billion in FY 20. As the market is growing at an unprecedented pace, the Indian healthcare industry is a goldmine for investors and businesses.

In addition to hospitals and healthcare centers, there are ample opportunities in the diagnostics or pathology lab business in India. The demand for diagnostic services is increasing at a rampant speed. India’s expansive middle class, growth in per capita income, growing health awareness, and shift in healthcare with an increased focus on prevention rather than cure will continue to dovetail the segment in a positive direction. 

The Indian government is also making structural policy reforms, which is a positive sign for the industry. Under the flagship of Ayushman Bharat, India is implementing universal healthcare insurance. Apart from healthcare services, Ayushman Bharat also focuses on universal access to quality diagnostic services. 


5 Vital Steps to start a Diagnostic Business in India 

Businesses and investors are increasingly entering the diagnostic category, lured by its high potential. Meanwhile, it is also important to have an in-depth understanding of how to start and operate the business. 

The mentioned below steps will help in starting and running a pathology lab in India. 

Obtain Licenses and Registration 

The process of starting a pathology lab or diagnostic center begins by registering the business and by obtaining necessary licenses to gain trust and credibility. Individuals opening a pathology lab will need to obtain a trade license or Shop Establishment Act at the nearest Municipality or Panchayat office. The business should also be registered with the Clinical Establishment Act and Biomedical waste disposal body by applying online on their respective websites. The licenses that are required for opening a pathology lab include:

  • Accreditation from Good Clinical Practices (GCP)
  • Approval for waste generation from their state’s pollution board
  • NOC from Fire Department 
  • NOC from Municipality  

Accreditation from National Accreditation Board for Testing and Calibration Laboratories (NABL),  is an optional license applicable for large centers only.

Individuals starting a pathology lab should be qualified pathologists and must have obtained an MD or equivalent degree from a medical college recognized by MCI (Medical Council of India). 

Infrastructure & Setup Requirement

The pathology lab needs to be set up depending upon the number of lab services offered. There are thousands of pathology services which are available. Some of the common types of pathology include blood tests, urine tests, blood glucose level tests, image diagnosis, thyroid test, iron test, etc. However, the services offered depend on the budget and the kind of demand in the available market. 

If one wishes to start with a low investment, then one can have a small setup of the pathology lab where they can conduct only fewer tests and diagnoses. Some of the basic types of diagnoses include blood sugar tests, urine tests, microscopy, serology, etc. 

On the contrary, an individual can invest more, and add numerous other testing facilities such as  X-rays, MRIs & CT scans, mammography, Haemotology, advanced microbiology, etc. Depending on the range of services offered, one has to spend on infrastructure, machinery, equipment, staff, and software tools, etc. 

Irrespective of the number of services offered, one should have a clear layout planned for various treatment areas so that tests and diagnoses are coherently conducted. For starting a pathology lab, one needs to have enough space to set up a pathology lab that can accommodate large number of patients at the same time without making the lab look congested. The space should be carefully planned and equipment should be properly placed at their place. No two testing activities should be clubbed together that can lead to inaccurate results or any undesirable situation.   

The pathology lab should have a clean and healthy environment because failing to do so can lead to health issues for both patients and staff. Some of the facilities that should be present in the lab are clean restrooms,  a blood collection center, lab equipment, storage, and waste disposal, a waiting area, and wheelchairs. 

Hire Staff for the Pathology Labs

Individuals opening pathology labs will require a highly skilled team comprising doctors, nurses, technicians, pathologists for the successful functioning of the labs. Likewise, they will also need microbiologists and biochemists, etc depending on the number of services offered. 

The staff working in the lab must have standard qualifications to carry out their respective task. The staff of the pathology lab should be provided with apt training and induction programs at the initial stage of their job to ensure they efficiently operate. The staff of the lab should be properly vaccinated to prevent them from the communicable diseases that they can get from the patients. The staff should also be consistently updated about changing techniques and should be aware of conditions in the medical field, new medicines, innovations, as well as new techniques so that they can make necessary changes in the diagnosis process if required.   


Based on the types of services offered, a pathology will need to have equipment.  It is essential for the lab to have a wide range of testing tools that will allow conducting more types of tests for the coming patients. Today patients prefer to visit a lab where a large number of testing services are offered so that they can undergo all the recommended tests at a single lab only. Some of the essential equipment that is must in a pathology lab are a full auto analyzer, semi-auto analyzer, washer, reader, blood cell counter, deep fridge, blood gas analyzer, microscope, regent and chemicals, colorimeter, and dispensing scale, etc. 

To operate a pathology center effectively, it is also essential to have advanced software tools and services. The pathology lab should have advanced lab management software that will help staff in scheduling appointments, keep track of medical records of patients, and manage prescription, billing, inventory, MIS, and analytics, etc. There are numerous software vendors available in India and one can choose a suitable package from them. It is generally advisable to choose packages that can be seamlessly integrated with the existing system without incurring incremental costs. 

Marketing and Business Development 

After opening a pathology lab one will need to chalk out a strong marketing and business development plan to create awareness and gain market share. Implementing a good marketing strategy will allow the pathology lab to attract a good number of patients. In today's internet era one can make use of digital marketing and social media marketing to popularize the lab among the local population. It is advisable to have a fully functional website. Similarly investing in search advertisements and local SEO is also a prudent marketing tactic. 

Pathology labs can also tie-ups with hospitals or other organizations to offer bulk services at discounted prices. Word of mouth will also prove an effective promotional stint for the labs.  Meanwhile, labs also need to focus a lot on the quality of services as it is very helpful in building the right brand image. 

How The  India Watch can Help? 

Despite high demand and tremendous growth potential, India’s diagnostic service industry is still underdeveloped, unorganized, and fragmented. There are a handful of big diagnostic chains alongside pathology divisions of large hospital enterprises such as Fortis, Ranbaxy, Apollo, etc. In smaller towns, the industry is mostly run by small pathology labs and diagnostic centers of local hospitals. The demand-supply mismatch, further entails that the industry will continue to grow vigorously in the foreseeable future. 

Meanwhile to succeed in a competitive market like India will also require access to quality insights, data, and advisory. That is where information advisory like The India Watch comes into the picture. 

  • We offer business research and data services to hospitals, investors, and health care enterprises
  • We offer tailor-made market research services to new ventures and investors looking to enter the segment 
  • We can create feasibility analyses for new lab projects. This can help investors and promoters to understand whether there is an actual market available for the business plan or not. 
  • We can conduct market surveys to understand more about patient’s need as well as their experience cycle. 
  • Tailor-made data advisory and insight services to help healthcare enterprises make better business forecasts and strategic planning. 
  • Our policy research practice can help a business learn more about healthcare regulatory practice in the country. 
  • We can work as knowledge partners for healthcare platforms, media houses, etc to offer constant data, knowledge, analyses, etc. 

For further query feel free to drop us a mail at Info@theindiawatch.com 




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