India to Spend $31 Billion on Health as Pandemic Exposes Cracks
(Bloomberg) -- India will hike its health spending by a massive 137% to boost its under-resourced public system that has struggled to manage the world’s second largest Covid-19 outbreak.
The South Asian nation of more than 1.3 billion people will increase its spending on health and well-being to 2.24 trillion rupees ($30.6 billion) in the fiscal year starting April 1, from the current 944.5 billion rupees, Finance Minister Nirmala Sitharaman said in her annual federal budget speech to parliament on Monday.
India currently spends just 1.28% of gross domestic product on public health, a figure that lags behinds global averages and has been described as low by its own planning organization Niti Aayog. Prime Minister Narendra Modi’s administration had in its first term promised to raise that number to 2.5% by 2025.
“The investment on health infrastructure in this budget has increased substantially,” Sitharaman said. “Progressively, as institutions absorb more, we shall commit more.”
Sitharaman said that India has so far pledged to spending 350 billion rupees on vaccines, adding the country was “committed to provide more.” She also announced that the government would spend 641.8 billion rupees on boosting primary, secondary and tertiary health care facilities to be spread over six years.
“This ground-breaking focus on health which will provide access to medical care for all in our country, fuel job creation and boost economic momentum,” Prathap C Reddy, chairman of Apollo Hospitals Enterprise Ltd., India’s largest healthcare chain, said in a statement on Monday. “We must now look at the next crisis of non communicable diseases, which will be responsible for 80% of deaths and cause a $3.8 trillion burden to the country by 2030.”
India is the second-worst virus-hit country in the world, trailing only the U.S. with more than 10.7 million infections and 154,392 deaths. The crisis has highlighted the gaps in its ability to meet the basic needs of its population, especially during a health emergency.
At the peak of its pandemic -- between June to September -- the country scrambled to boost testing even as its hospitals struggled to accommodate the influx of virus-infected patients.
“A lot of us have been asking for that for a long time and I think this whole pandemic experience has highlighted that you need to invest a lot more into health,” said Anant Bhan, a bioethics and health researcher at Yenepoya University, in the southern Karnataka state.
In recent years, New Delhi has looked to address an underfunded public system and low levels of insurance in a country where about 60% of health care expenses are paid out of pocket, putting medical care out of reach for many. Still, increased spending at a federal level may face challenges as much of the nation’s health policy is determined by the country’s states.
“As much as investment is important ensuring that it is utilized is also important,” Bhan said, noting in some cases available funding is not used by the end of the financial year.
“The other thing is health system strengthening, which is things like infrastructure but also human resources for the longer term -- ensuring that we have systems to be able to ramp up our lab testing when we have situations like this with staffing available.”
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