DIGITAL GST READINESS AND SERVICE COMPETITIVENESS IN HYDERABAD'S MEDICAL TOURISM SECTOR

This paper has examined the interface between digital GST readiness and service competitiveness in Hyderabad's medical tourism sector, drawing on primary survey data and a comprehensive secondary source analysis. The key findings are: (i) Hyderabad's medical tourism sector is growing robustly, with its share of national arrivals rising to an estimated 11.2 per cent in 2023–24; (ii) digital GST compliance infrastructure is strong among large corporate hospitals but unevenly distributed across the sector; (iii) the asymmetric GST rate structure imposes a significant cost burden on bundled medical tourism offerings and restricts ITC utilisation; and (iv) delayed IGST refunds and complex classification norms constitute the principal compliance barriers. The paper adds to the burgeoning body of literature on the sectoral effects of GST and to the policy debate on the economic development path that the state of Telangana would take. Its suggestions – GST rationalisation for medical tourism packages, a proportionate ITC allowance benefit, fast-track IGST refund mechanisms, and an IT compliance support programme by the state – are implementable in the current constitutional and legislative frameworks. Together, they can make a big difference to the city's ability to cater to the medical tourism needs of the world, provide employment opportunities, generate foreign exchange, and other socio-economic benefits to the State of Telangana.  

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