No Money for Health

PUBLIC HEALTHCARE SPENDS WILL REMAIN LOW EVEN THOUGH THE NEEDS OF RURAL INDIA ARE A NEW FOCUS

- AMARNATH K. MENON

THE ALLOCATION FOR HEALTHCARE IN Budget 2020-21 was disheartening—at Rs 67,484 crore, it’s a modest 5.7 per cent increase over the revised estimate of Rs 63,830 crore in the previous year. The allocation, given the estimated nominal GDP growth of 10 per cent, will mean a fall in public health expenditure as a percentage of GDP. Healthcare inflation in India is currently between 14 and 16 per cent and, considering the measly increase in budgetary allocation, public health expenditure is likely to stay under 1.5 per cent of GDP—a far cry from the targeted 2.5 per cent by 2025. At 1.3 per cent, India’s public sector spend in healthcare lags behind its neighbours Bhutan (2.5 per cent) and Sri Lanka (1.6 per cent). However, sub-strategies within the allocations point to a sharper focus on rural areas with unmet medical needs.