What does the Union budget for FY 17-18 holds for the healthcare sector in India

In India, the average growth in expenditure on total healthcare is lower than the average GDP growth rate.

In India, the average growth in expenditure on total healthcare is lower than the average GDP growth rate. The GDP spend percentage is lower than most low income countries.

India is a low-middle income country as per the World Bank classification. In fact, the growth in expenditure on total healthcare in India has been decreased from what it was a decade ago (from 4.3 per cent to 4.05 per cent).

In a recent session at Harvard School of Public Health (HSPH) in 2012,it was noted that India spent about $40 per person annually on healthcare where as the United States spent $8,500. The entire GDP of India was $1.6 trillion then while the US healthcare spending alone was $2.6 trillion.









In the budget for FY 2017-2018, the union government announced a slew of measures for boosting the healthcare in India. In the year 2016-17 the National Health Mission was allotted Rs20,762 Crores which been increased to Rs. 27,131 Crores. For our common consumption, I have categorized the details of the changes as following


Mahila Shakti Kendra” will be set up at village level with an allocation of Rs. 500 crores in 14 lakh ICDS Anganwadi Centres. This will provide one stop convergent support services for empowering rural women with opportunities for skill development, employment, digital literacy, health, and nutrition. A nationwide scheme for financial assistance to pregnant women has already been announced by Honourable Prime Minister on 31st December, 2016. Under this scheme, Rs. 6,000 each will be transferred directly to the bank accounts of pregnant women who undergo institutional delivery and vaccinate their children.


Poverty is usually associated with poor health. It is the poor who suffer the maximum from various chronic diseases. Government has therefore prepared an action plan to eliminate Kala-Azar and Filariasis by 2017, Leprosy by 2018 and Measles by 2020. Elimination of tuberculosis by 2025 is also targeted. Similarly, action plan has been prepared to reduce IMR from 39 in 2014 to 28 by 2019 and MMR from 167 in 2011-13 to 100 by 2018-2020. 1.5 lakh Health Sub Centres will be transformed into Health and Wellness Centres.


The government has decided to ensure availability of specialist doctors to strengthen secondary and tertiary levels of health care.  It has been decided to create additional 5,000 Post Graduate seats per annum. In addition, steps will be taken to roll out DNB courses in big District Hospitals; strengthen PG teaching in select ESI and Municipal Corporation Hospitals; and encourage reputed Private Hospitals to start DNB courses. In addition two new All India Institutes of Medical Sciences will be set up in the States of Jharkhand and Gujarat.


The government proposes to amend the Drugs and Cosmetics Rules to ensure availability of drugs at reasonable prices and promote use of generic medicines. New rules for regulating medical devices will also be formulated. These rules will be internationally harmonised and attract investment into this sector. This will reduce the cost of such devices. For senior citizens, Aadhar based Smart Cards containing their health details will be introduced. A beginning will be made through a pilot in 15 districts during 2017-18.


The NDA Government did plan to bring about a ‘complete transformation’ of the health sector and even worked on the blueprint of the world’s largest universal health insurance program, partially inspired by US President Barack Obama’s grand insurance-for-all project which is popularly known as ‘Obamacare’.

The Government now needs to act on its plans. The Union Budget 2016 must allocate more money to the healthcare sector. The sector is in dire need of funds to improve their infrastructure and skill sets and to increase capacity. There are leakages of allocated funds at all levels. It is important to link initiatives like Digital India to bring in more transparency in the allocation of funds and its expenditure by Government Hospitals and Medical Officers.

It is said, Health is Wealth. Mr. Jaitley, while steps to improve the economy are much appreciated, a healthy India will hasten the progress towards a wealthy India!

About the author


Purva Gupta is a Management Graduate in Hospital and Healthcare Management, with specialization in Healthcare Informatics from International Institute of Health Management Research, New Delhi. She is highly motivated professional who loves challenges, possesses decision making, leadership and problem solving skills. Please direct all questions and comments on this article to purvagupta456@gmail.com

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