Modernising health finance

With limited fiscal space, India must adopt innovative mechanisms to unlock new health financing

- INDU BHUSHAN SIDDHARTHA BHATTACHARYA

INDIA'S HEALTHCARE SYSTEM stands at a decisive moment. The country faces a quarter of the world's most significant disease burdens-home to the largest population living with noncommunicable diseases (including over 100 million people with diabetes) and more than one billion communicable disease cases annually.

Alongside this sits the world's secondlargest ageing population, creating a scale and complexity of need that expands each year. Yet, despite shouldering nearly a quarter of the global disease burden, India contributes less than 2% of global health expenditure. Even with a highly cost-efficient health system, the gap between healthcare needs and available financing is widening rapidly. Unless India strengthens its health financing architecture and builds large, efficient risk pools that promote savings, prevention, and innovation, the country will struggle to expand access, modernise infrastructure, and keep pace with changing health needs.

This urgencyis heightened by a rapidly shifting disease profile. By 2030, around 75% of all deaths in India are expected to arise from noncommunicable diseases (NCDs), with an increasing proportion of patients managing multiple comorbidities. Health-seeking behaviour has also accelerated significantly post-pandemic, supported by policy momentum. Meeting this demand requires substantial capital.