Union Budget of Healthcare 2021: Interlinking All Aspects of Health


By Apurva Bhatnagar, Research Assistant, RIS

The Hon. Finance Minister on 1st February, 2021 announced a 137 per cent increase in the budgeted expenditure on healthcare in India. The budget healthcare expenditure has increased to 2.33 lakh crore for FY 2021-22 from 94.45 thousand crore in FY 2020-21. With the National Health Policy, 2017 (NHP) envisaging annual expenditure on health and wellbeing at around 2.5 per cent of GDP by 2025, this is surely a welcome step towards that direction.

It should be noted that healthcare is currently in the state list, although there has been growing pressure from public healthcare experts in India that the subject should be moved to concurrent list. Expenditure of all state governments on Health and Family welfare has increased modestly from 0.6 per cent of GDP to 1 per cent of GDP during 2010-11 to 2020-21.[1] As noted by various public health experts/organizations, including RIS, this figure is still low, particularly when compared with international standards. Consider for example that the governments of Brazil, Russia, China and South Africa spend around 3.96, 3.16, 3.02 and 4.46 percent of their respective GDP on healthcare.[2] In fact, NHP 2017 also raises concern on the low government healthcare expenditure in India.

The result of low government expenditure on healthcare usually translates into high Out of Pockets Expenditure (OOPE) on healthcare which in turn increases the risks of vulnerable groups falling into poverty due to catastrophic health expenditures. In fact, one of the main targets of SDG-3, “Good Health and Wellbeing for All”, is to universally provide financial risk protection from catastrophic healthcare spending. It should also be noted that Hon. Finance Minister, Ms. Nirmala Sitharaman had highlighted that high OOPE in India is a matter of concern and government must pitch to address this, before revealing the hike of 137 per cent in healthcare. In Table-1 we reproduce the Annexure on expenditure on health and wellbeing from the budget speech to analyse the various heads under which the budgeted Rs. 2.33 lakh crores will be spend. We also see how these figures compare to the previous year’s budgeted and revised estimates in these same head.

Table-1: Breakup of Health and Welfare budgeted expenditure, 2021-22 (in Rs. crores)








D/o Health and Family Welfare




D/o Health Research








COVID-19 related special provision








D/o Drinking Water and Sanitation








FC grants for Water and Sanitation




FC Grants for Health








Source: Annexure, Part-A, Budget Speech 2021-22. Online at: https://www.indiabudget.gov.in/

A cursory look of the table-1 shows a clear intention of the government to focus more on precautionary and preventive healthcare practices. It is for this reason that the budget of Department of Clean Water and Sanitation has been increased by 179 per cent from Rs. 21,518 crore to Rs. 60,030. This is excluding the Finance Commission grant of 36,022 made for water and sanitation. There cannot be any doubt that this is a good step to prevent the spread of vector and water borne diseases, as well as other communicable diseases. It should be noted that the disease profile of India is undergoing a change where the disease burden is shifting from communicable diseases (CDs) to Non-Communicable Diseases (NCDs). Therefore, to reduce high OOPE in India, government must make the treatment of both CDs and NCDs, more accessible and affordable at Pan India level. The government flagship programme, Ayushman Bharat was introduced to tackle the issues of accessibility and affordability and this can be expanded further in coming years. Figures from table-1 also show that many of the heads under which the healthcare expenditure is distributed. This includes expenditure on COVID-19 vaccination and Finance Commission grants on health, water and sanitation. This increased allocation on healthcare in FY 2021-22 should be sustained in the coming years to achieve the healthcare spending target set forth by NHP, 2017.

Another interesting fact about the healthcare budget for this year that is not seen in table-1 would be the expenditure on development of pharmaceutical industry. The head for ‘Development of Pharmaceutical industry’ under the budget allocation of Dept. of Pharmaceuticals, Ministry of Chemicals and Fertilizers saw a massive jump of 196 per cent increased allocation compared to last years’ budget allocation.[3] The budgeted allocation for development of pharmaceutical industry in India was 42.05 crores last years, which has now been increased to 124.42 crores this year. It has been a firm stand of RIS, that government must incentivize Research and Development (R&D) initiatives in pharmaceutical industry and improve the university-industry connect in pharma sector. With a massive increase in budget allocation, the department of pharmaceutical would certainly have the means to work on the two issues ailing pharma industry in India. Although, how this figure will be utilized for the development of industry is yet to be seen.

In conclusion, this brief analysis of healthcare budget notes that we are on the right track towards achieving the goal of government healthcare spending as a proportion of GDP of 2.5 per cent. However, the intensified momentum and interest of government in healthcare, brought about by the pandemic, must be sustained.

[1] Reserve Bank of India: State Finances : A Study Of Budgets, 2020. Online at: https://www.rbi.org.in/Scripts/AnnualPublications.aspx?head=State%20Finances%20:%20A%20Study%20of%20Budgets

[2] Global Health Observatory Dataset, World Health Organisation. Online at: https://apps.who.int/gho/data/node.main

[3] See: Union Budget, Ministry of Finance, “All Statements of Budget Estimates”. Online at: https://www.indiabudget.gov.in/


  1. It’s remarkable to pay a quick visit this website and reading the views of all colleagues on the topic of this post,while I am also eager of getting familiarity. lumibett


  2. Staying fit by exercising daily also helps to keep one’s health in proper check. If you are in good health, you can always work to attain more wealth. But if one is not healthy, then wealth is of no importance. Hence, we should adopt and work towards a healthy lifestyle.ข่าวกีฬา


  3. Liposuction should never be considered an alternative to a healthy lifestyle, it is one of the steps that can get you to a better version of yourself through fat reduction.ข่าวกีฬาออนไลน์

  4. Greetings! Very helpful advice within this post! It is the little changes that will make the most significant changes. Thanks a lot for sharing! Feel free to visit my website.ข่าวกีฬาออนไลน์

  5. I think I need to hire someone like you to come deck out my house. I’m hopeless at this sort of thing. I know what I like, it just doesn’t get done! Tragic, I know. At least I can dream about someday become more adept at these things.ข่าวกีฬาออนไลน์

  6. It?s true that having a strong support system can make a great difference and guarantee progress. It is also fun and inspiring to achieve your health goals with your love ones. Eating healthy together and working out should be a good start.Why Being a Nagging Wife May Save Your Husband’s Life


  7. The healthy and successful approach to get more fit is a similar one that specialists have been prescribing for quite a long time.188Bet

  8. This can include a wide variety of different habits. Such as spend your time with your loved one, use fresh fruits, increase the use of water and sleep a full night then our mental health remains healthy.Fun88

  9. The content you've posted here is fantastic because it provides some excellent information that will be quite beneficial to me. Thank you for sharing that. Keep up the good work.keto diet recipes

  10. very interesting to learn and easy to understand. for more know go
    RYT 200瑜珈證書課程


  11. Denise you captured the human experience of what it means to struggle and survive during an unprecedented time .Your honesty and authenticity help me and others to feel connected to you during this turbulence . Thank you for sharing and allowing yourself to be vulnerable .I feel your compassion for humankind while living fully through this experience .Binoid

  12. Excellent job, this is great information which is shared by you. This info is meaningful and factual for us to increase our knowledge about it. independent support worker ndis

  13. Thanks for picking out the time to discuss this, I feel great about it and love studying more on this topic. It is extremely helpful for me. Thanks for such a valuable help again.impetigo vs cold sore

  14. Excellent knowledge, You are providing important knowledge. It is really helpful and factual information for us and everyone to increase knowledge. Continue sharing your data. Thank you. Read more info about.humalog pens

  15. Interest is added to a principal sum that already exists as well as to interest that has already been paid through a process known as compound application. Consequently, compounding can be thought of as interest on interest, which has the effect of magnifying returns to interest over time, or the so-called "wonder of compounding."

  16. I really loved reading your blog. It was very well authored and easy to understand. Unlike other blogs I have read which are really not that good. Thanks a lot.https://kangaroo.co/what-cells-does-hiv-attack/

  17. Our team of highly trained locksmiths brings a wealth of experience to the table, ensuring that whether you're facing a lockout situation, need a lock repaired or replaced, or are interested in bolstering your property's security, we have the expertise to handle it all. What sets us apart is not only our technical proficiency but also our commitment to customer satisfaction.locksmith near me

  18. Your honesty and authenticity help me and others to feel connected to you during this turbulence . Thank you for sharing and allowing yourself to be vulnerable .I feel your compassion for humankind while living fully through this experience .Ladies pants


Post a Comment

Popular posts from this blog

Health related Innovation, Incentivization and IPR for Post- Covid World – A vision for the South

A European Approach to Regulate Artificial Intelligence: Possible Global Impact