India spends just 1.2% of its GDP on healthcare, but a policy can change that


  • Currently, India spends only 1.2% of its GDP on healthcare.
  • the government has passed the National Health Policy (NHP) to increase the public healthcare spending to 2.5% of the GDP with a special focus on the underprivileged.
  • Once launched Modicare will be world's largest government-run insurance scheme of its kind.
India spends only 1.2% of its GDP on healthcare. And with that figure, the country ranks in lower than Singapore that has one of the lowest public health expenditures in the world at 2.2% amongst countries with significant United Health Care (UHC) services.

If that 1.2% was not a figure dismal enough, India spends 2.5% of its GDP for military purposes. It is time the country resets its priorities.

With 55 million Indians falling below the poverty line in a single year because of heavy medical expenses and no help from the government, the poor also have very little to choose from when it comes to public and private healthcare. While public healthcare maybe the best that they can afford, the standards of public hospitals are deplorable, and private facilities are far too expensive.

India's per capita public expenditure on health was as low as ₹621 in 2009-10. Though it increased to ₹1,112 ($16) in 2015-16, it seems almost absurd when compared to countries like the US and the UK with expenditures of $4,802 and $3,500 respectively.

But perhaps, things can change now.

To make the situation better, the government has finally passed the National Health Policy (NHP) which commits to spending 2.5% of the GDP on healthcare with a special focus on the underprivileged.

Dr Ravi Wankhedkar told The Times of India that the national president of Indian Medical Association (IMA) for 2018, the spending should have been raised to at least 5%.

NHP will also extend its focus on shifting from “sick care” or cure to “wellness” or prevention. The policy further promises to venture into a new concept of “strategic purchasing” from the private sector to achieve the national health goals. It also has envisioned targets to reduce the Maternal Mortality Ratio, and Infant Mortality Rate significantly.

The situation may improve even further with the National Health Protection Scheme (NHPS) that the government is planning to launch soon. The scheme plans to target over 100 million poor families with an annual health cover of ₹0.5 million per family.

Often called Modicare, once it is launched, will be world's largest government-run insurance scheme of its kind. According to the health minister, JP Nadda, the scheme will be able to significantly bring down the citizen’s ‘out of pocket’ expenditure on health, which pushes millions of Indians below the poverty line every year. India’s ‘out of pocket’ expenditure currently stands on 67.78% against the the world average of 18.2%, according to WHO.

Though the schemes seem progressive, they have been strongly criticised by activists because it scrapped a section of the final draft which proposed to make health a fundamental right. They believe that the failure to provide healthcare should have serious legal consequences and without that provision, the policy remains a hollow promise.
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