Big European hospital groups are looking to India and the Middle East to invest rather than less developed areas of Europe such as the recent EU entrants and the Ukraine.

Sources at Acibadem, the largest Turkish group, say they plan to move East. After looking closely at opportunities in Eastern Europe, Acibadem will focus on the Middle East and the ‘Stans.

Meanwhile, Indian news sources say that big private German hospital group Asklepios is interested in India, where there is talk of it raising a $100-200m fund to develop new hospitals or to partner with local companies. Dr Jochen Schmidt, who took over as head of international in January was in India last month. Polish sources say Asklepios had looked very seriously at setting up a hospital in Warsaw. Dr Schmidt took over Asklepios International at the start of 2009. An Asklepios spokesman refused to comment on the company's plans.

Asklepios also owns 30% of Athens Medical, a big, quoted Greek hospital chain, but its plans for expansion into the Balkans have been put on hold as the recession bit.

Our Analysis: In some ways this is not surprising. Healthcare in the Accession countries is generally very corrupt. Apart from Slovenia and the Czech Republic, it is fair to say that it still remains behind an Iron Curtain. Public sector doctors regularly take bribes and this massive informal private sector effectively prohibits the development of a legitimate private sector outside of subscription healthcare services and diagnostics. Meanwhile, the governments in the region are incapable of enacting reforms and fail to push through any moves to private healthcare insurance making it virtually impossible to build anything with any scale.

India with its huge 200m strong middle-class must look a great deal more attractive. And this applies not just to the big hospital groups but also to many private equity outfits.