Budget 2022: Despite Covid pandemic, health no longer the highlight

Vaccination allocation for FY22-23 at only Rs 5,000 crore against Rs 39,000 crore for FY22

Despite the global Covid pandemic that is far from over, Finance Minister Nirmala Sitharaman’s Budget 2022-23 did not see any significant increase in the allocation towards the health sector, unlike last year when she had announced a 137 per cent increase in health and wellbeing expenditure.

While Rs 5,000 crore has been earmarked for Covid vaccination support to states for 2022-23, FY22’s Revised Estimate shows a spend of Rs 39,000 crore on the vaccination drive that has covered over 75 per cent of the adult population since its launch on January 16, 2021.  

Over the Revised Estimates, the total health expenditure budget in 2022-23 has increased 0.23 per cent to Rs 86,200 crore. Health experts see this Budget as a signal of a shift to a post-pandemic phase by the government. The drop in allocation for vaccination may also indicate that the government feels that adequate jabs have been administered. 

“The Budget has given a nod to certain areas within health but we need to spend a lot more on the health workforce. The government is signalling through this Budget that Covid is no longer a threat,” said K Srinath Reddy, president, Public Health Foundation of India.  

According to Budget documents, a lower requirement for vaccination has led to a decline in the earmarked medical and health spending from Rs 74,820 crore in the ongoing fiscal year to Rs 41,011 crore in the next year. 

Sitharaman, acknowledging the plight of those who suffered the adverse health and economic impact of Covid, said with the accelerated improvement of health infrastructure over the past two years, “we are in a strong position to withstand challenges”. She also said: “We are in the midst of an Omicron wave, with high incidence but milder symptoms. Further, the speed and coverage of our vaccination campaign has helped greatly.” 

There has been an increase of over 7 per cent in the allocation towards the National Health Mission. Pardhan Mantri Swasthya Suraksha Yojana has also seen an allocation increase from Rs 7,400 crore to Rs 10,000 crore. The health infrastructure mission, too, has seen its budget go up from Rs 315 crore to Rs 978 crore. 

The finance minister announced a ‘National Tele Mental Health Programme’, taking a cue from the rise in mental health problems in people of all ages due to the pandemic. “This will include a network of 23 tele-mental health centres of excellence, with NIMHANS being the nodal centre and the International Institute of Information Technology-Bangalore providing technology support,” she said.

“The move will support private players and start-ups in this segment to increase the current coverage of the locations, including tier-2 and tier-3 cities, to provide advanced health-care facilities in these areas,” said Vikram Thaploo, CEO, Apollo Telehealth.

There’s been almost an 80 per cent rise in consumption of digital health-care services after Covid-19. The post-pandemic era is likely to witness a significant increase in digitised health-care that needs nourishment with solid governance. 

The government will also roll out an open platform for the National Digital Health Ecosystem comprising digital registries of health providers and health facilities, unique health identity, consent framework, and universal access to health facilities. “Upgradation of 200,000 anganwadis and the rolling out of the digital health mission will also help provide greater access to health-care services and strengthen capacities. Digital health ecosystem is an area where we would have appreciated some more allocation,” said Ashutosh Raghuvanshi, MD & CEO, Fortis Healthcare. 

Though the industry welcomed these announcements, the Budget dashed the hopes of many who were expecting the health sector to see a big jump in allocation. “We thought that the only silver lining out of this (pandemic) would be that the current state of health-care facilities in the country would attract the attention of the government… And we will see a big push towards health-care spending, at least to the promise of 3 per cent of GDP. Unfortunately, we haven't heard much on health-care and education in this Budget,” said Shuchin Bajaj, founder of Ujala Cygnus group of hospitals. 

Analysts at ICRA said the modest allocation towards the sector would make it challenging for the government to meet its target public sector health-care investment of 2.5 per cent of GDP by 2025.

The manufacturing industry seemed disappointed with the Union Budget 2022-23 as well. Rajiv Nath, CMD of Hindustan Syringes and Medical Devices said he was expecting the government to adopt measures to boost domestic manufacturing of medical devices — an industry that is 80-85 per cent import-dependent. “Sadly the Budget speech has no strategic stated measures to boost domestic manufacturing. The government relied on domestic manufacturers when imports got disrupted during the Covid-19 crisis,” he added.

Former health secretary K Sujatha Rao said: “Such disdain for these human capability sectors... is simply being irresponsible.”