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Union Budget and health sector

Union Finance Minister Nirmala Sitharaman presented the general budget 2021-22 on February 1, 2021 saying that the budget proposals rest on six pillars,

Union Budget

Sentinel Digital DeskBy : Sentinel Digital Desk

  |  11 Feb 2021 4:35 AM GMT

Dr. Dharmakanta Kumbhakar

(He can be reached at

Union Finance Minister Nirmala Sitharaman presented the general budget 2021-22 on February 1, 2021 saying that the budget proposals rest on six pillars, including health and well-being. With an announcement that India has a holistic approach to health and focuses on strengthening three areas – preventive, curative and well-being – the FM allocated Rs 2,23,846 crore for expenditure on health and well-being in the Budget. It is around 137% higher than the Budget estimate of Rs 94,452 crore for 2020-21. The Budget allocation for health and well-being includes the total funds that are allocated to the Union Ministry of Health and Family Welfare, Department of Health Research, Union Ministry of Ayush, vaccination, drinking water and sanitation, nutrition, Finance Commission grants for water-sanitation and health.

The FM announced a new centrally-sponsored scheme 'PM Atmanirbhar Swasth Bharat Yojana' in the budget, which will be launched with a total outlay of Rs 64,180 crore over a period of next six years. The scheme will focus on investment on health infrastructures development. It will develop capacities of primary, secondary and tertiary healthcare systems; strengthen existing national institutes and create new institutes for detection and cure of new emerging diseases like COVID-19. It will be in addition to the National Health Mission. The main interventions under the scheme include support to set up 17,788 rural and 11,024 urban Health and Wellness Centres, setting up of integrated public health laboratories in all districts and 3,382 block public health units in 11 States, establishment of Critical Care Hospital Blocks in 602 districts and 12 central institutions, strengthening of the National Centre for Disease Control and its five regional branches and 20 metropolitan health surveillance units, expansion of Integrated Health Information Portal to all States/UTs to connect all public health laboratories, operationalization of 17 new public health units and strengthening of 33 existing public health units at points of entry, that is at 32 airports, 11 seaports and 7 land crossings, setting up 15 health emergency operation centres and 2 mobile hospitals, setting up of a national institute for health, a regional research platform for WHO South East Asia Region, 9 Bio-Safety Level III laboratories and 4 Regional National Institute for virology. India suffered a lot during COVID-19 pandemic due to lack of sufficient well-equipped health infrastructures. The scheme will change the picture of Indian's health if it is implemented in letter and spirit.

In reality, as per the budget allocation for the health sector, the Union Ministry of Health and Family Welfare actually expects to spend Rs 71,269 crore in FY 2021-22 which is an increase of around 9.62% compared to the budget of Rs 65,012 crore of last year. But the revised estimate for the FY 2020-21 is Rs 78,886 crore. This implies that actual budgetary allocation for health sector has come down by 9.66%. This year the COVID-19 pandemic gave the FM an opportunity to be an outlier and allocate more money to the health sector than what had been done earlier. But it seems she wasted it. There was a dire need to increase the Budget allocation to the health sector to cope up with the COVID-19 pandemic. In the beginning of the Budget speech, the FM thanked the frontline workers for their selfless services during the pandemic. But the budget failed to allocate funding for ensuring minimum wage and insurance for all the frontline health workers, especially Anganwadi and Asha workers.

The budget of the NHM has increased by 9.55% over the previous year from Rs 33,400 crore to Rs 36,575.5 crore in 2021-22. Most of this increase has been focused on NRHM and the counterpart NUHM has not received much attention. The NUHM received only Rs 50 crore increases over the previous budget from Rs 950 crore to Rs 1,000 crore. A host of health schemes are bundled under NHM. Considering the need for more funds for public healthcare, which caters to the poor people, the allocation should have been increased.

The allocation towards Government's flagship insurance scheme launched in 2018, Ayushman Bharat-Pradhan Mantri Jan Arogya Yojana (AB-PMJAY) remained unchanged at Rs 6,400 crore this year in the budget though it needed to be scaled up. The scheme aims to reduce the out-of-pocket private expenditure on health that has been pushing several people into poverty, especially during and after COVID-19 pandemic. Telemedicine got a big thumbs up for online consultation in the wake of COVID-19 pandemic. However, the allocation to it remained stagnant at Rs 45 crore in the budget. In reality, while allocation towards health in the Union Budget 2021-22 focused on mitigating the impact of the pandemic, major public health schemes received insufficient funds.

The FM allocated Rs 2,663 crore for the Department of Health Research in the Budget for FY 2021-21 with an increase of 26.8% than last year's Budget estimate (Rs 2,100 crore). Usage of new machines and artificial intelligence in detecting and preventing the diseases, which will arise from medical and biotechnical researches, will be a great help for the healthcare practitioners.

In 2020 the COVID-19 pandemic affected more than one crore Indians and killed about 1.48 lakh people. India is currently using two COVID-19 vaccines named Covishield and Covaxin. The FM has allocated Rs 35,000 for COVID-19 vaccine in the Budget with a promise to allocate more funds in future if required. This is one of the best steps of the budget to make India COVID-19-free. For this to happen, universal, free and timely COVID-19 vaccination is necessary and more funds will be required. Moreover, the FM announced in the budget that Pneumococcal vaccines, made in India product, will be rolled out across India from present limited 5 States which will prevent more than 50,000 child deaths annually.

The Ministry of Ayush has been allocated Rs 2,970 crore for the fiscal 2021-22 which is 39.96% higher than the budget allocation (Rs 2122.08 crore) for the FY 2020-21.

The FM said that India has a holistic vision for healthcare that translates into wellness of the citizen. Proper nutrition, safe drinking water, sanitation and clean environment are prerequisites for achieving universal health. The FM announced that supplementary nutrition programme and the Poshan Abhiyan will be merged as Mission Poshan 2.0 to strengthen nutritional content, delivery, outreach and nutritional outcomes across 112 aspirational districts. For this the FM allocated Rs 2,700 crore in the budget. This will reduce the malnutrition and nutritional anaemia in the population. A much focused safe water availability (Jal Jivan Mission) and comprehensive sanitation programme (Swachh Bharat Mission) was launched in 2020 to support the holistic health vision. The FM allocated Rs 60,030 crore to the Department of Drinking Water and Sanitation to continue the Jal Jivan Mission and Swachh Bharat Mission. These will definitely help to reduce the water born diseases (like cholera, dysentery, typhoid, hepatitis A, Jaundice, etc.), worm infestation, etc., in the population. The FM declared in the Budget that Jal Jeevan Mission (Urban) will be launched. It aims at universal water supply in all 4,378 Urban Local Bodies with 2.86 crore household tap connections as well as liquid waste management in 500 AMRUT cities. It will be implemented over five years, with an outlay of Rs 2,87,000 crore. For swachhta of urban India, the FM declared in the Budget that Urban Swachh Bharat Mission 2.0 will be implemented with a total financial allocation of Rs 1,41,678 crore over a period of five years from 2021 to 2026. Focus will be on complete faecal sludge management and water treatment, reduction in single-use plastics, reduction in air pollution by effectively managing waste from construction-and-demolition activities and bio-remediation of all legacy dump sites. The Budget has allocated Rs 2,217 crore for 42 urban centres in India to tackle the problem of air pollution. To reduce the vehicular pollution, the FM announced in the Budget about a voluntary vehicle scraping policy to phase out old and unfit vehicles. These will definitely reduce the respiratory diseases among Indians. These are some wellness measures in the Budget.

The Budget is promising in the health sector and expected to provide enhanced coverage of quality healthcare services to the people of India though there was a dire need to increase the health budget allocation. The schemes announced in the Budget will be of tremendous help to the people if it is implemented in letter and spirit. Hope, the Budget will reduce Indian's out-of-pocket health expenditure of the common Indian.

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