IFC, a member of the World Bank Group, has successfully completed its advisory work with the Indian State of Andhra Pradesh to help four public hospitals offer advanced diagnostics services to low and middle-income people.

As lead transaction advisor, IFC extended its global expertise for structuring and implementing public-private partnership (PPP) transactions to assist the government on this project. IFC was appointed by the state government last November to offer advice on upgrading diagnostic services at medical colleges in Kakinada, Kurnool, Vishakhapatnam, and Warangal through private participation.

The project has been awarded to a consortium of Wipro-GE Healthcare and Medall Healthcare after a competitive bidding process. The bid-winning consortium will invest in refurbishing and building facilities, installing equipments, and providing services. The government will pay for all patients referred by hospitals at rates quoted by the winning bidder. These rates are highly discounted to market rates for similar services.

“IFC’s advice and global experience is helping us set in motion a larger effort to leverage private sector for improving public health systems. With IFC’s guidance we have been able to conclude the bidding process in a record time frame,” said J Satyanarayana, special chief secretary for Health, Medical and Family Welfare, Government of Andhra Pradesh.

The project is an important step in the state government’s vision to strengthen public health service delivery to low- and middle income groups.

Paolo M Martelli, IFC Regional director for South Asia, said, “Making high-quality health care services affordable and accessible for underserved groups is top priority for India. PPPs offer an avenue to achieve this objective and IFC is delighted to be able to contribute toward this goal.”

Through its first PPP transaction advisory health-sector project in India, IFC is supporting development of a comprehensive policy framework to improve availability of quality and affordable health care.

Wipro-GE is a joint venture between Wipro Limited and General Electric Company, a global leader in manufacturing of medical equipments. GE Healthcare has partnered with public entities as technology provider in over 100 similar projects. Medall runs advanced diagnostic services in several Indian cities. The concession agreement was signed between the consortium, the government of Andhra Pradesh, and four teaching hospitals on July 16, 2010, in the presence of Sudarshan Reddy, the Andhra Pradesh Minister of Medical Education, in Hyderabad.

Of the five pre-qualified experienced firms in health care sector, three submitted bids. In addition to the winning consortium, these included Apollo Healthcare Enterprise Limited (Apollo Group) and Vijaya Diagnostics.