Impact of Home Country Terrorism on Medical Tourism in India January 2020

This paper examines the relationship between home country terrorism and medical tourism as many such countries are faced with failing health care systems because of the increased threat and incidences of terrorism. The results of this analysis show that there is a direct and significant effect of terrorism in a country on the number of medical tourists from that country. Using instrumental variable approach, I find that a country ranked high on the terrorism index is likely to send 28.95 per cent more patients to India for medical treatment than a country ranked lower on the same index. I also find that distance plays a crucial role in determining medical trade volumes between such countries and popular medical tourism destinations such as India. The analysis demonstrates that the top nations sending medical tourists to India are developing and/or war-ravaged countries. This is one of the first studies to look at the socio-political climate in a home country as a factor influencing trade in health services, in particular, medical tourism.