30/01/2015 8:12 AM IST | Updated 15/07/2016 8:24 AM IST

What Does Slashing The Healthcare Budget Mean For India's Ailing Public Health System?

Leukemia patient Aamir Sheikh sits outside Tata cancer hospital in Mumbai, India, Tuesday, April 2, 2013. India's Supreme Court on Monday rejected drug maker Novartis AG's attempt to patent a new version of a cancer drug Glivec, in a landmark decision that healthcare activists say ensures poor patients around the world will get continued access to cheap versions of lifesaving medicines. (AP Photo/Rafiq Maqbool)

One person dies from tuberculosis every minute in India. Millions of children die every year because of inadequate access to food and preventable illnesses like diarrhoea and pneumonia. India is the diabetes capital of the world and the third most obese country. Due to mental health conditions like depression, India's suicide rate in the 15-29 age group is the highest in the world. The Infant Mortality Rate in India is 40 which compares poorly with its neighbours including Bangladesh, Nepal and Sri Lanka.

One would expect that a country facing a crisis of this magnitude would increase its public health spending several fold. Instead, India's health budget for the year ending 31 March, 2015 is set to be cut by $950 million. Historically, India has spent 1.3% of its gross domestic product (GDP) on healthcare which is among the lowest in the world and nearly half of what it spends on military defence. China, in contrast, spends over 2.6% of its GDP on healthcare.

The repercussions of a budget cut can be disastrous for the following three reasons:

Firstly, as the statistics highlight India is facing a double burden of disease. While we are struggling with under-nutrition and communicable diseases, millions are also affected by obesity and non-communicable ailments like diabetes and cancer. In fact, the World Economic Forum estimates that non-communicable diseases will cost India over US $4.5 trillion between 2012 and 2030.

Secondly, reducing public spending will worsen the condition of the already under-resourced and under-staffed Government clinics and hospitals. A United Nations report estimates that 75% of India's health infrastructure and human resources is concentrated in urban centres where only 27% of its population lives. Without appropriate investment in infrastructure, encouraging doctors to serve in rural areas will remain a challenge, thereby exacerbating health inequalities. This is especially important because state-of-the-art private health facilities are limited to larger urban centres and are inaccessible for poor families. Public healthcare can therefore fill an important gap, however, that will not be possible without a substantial increase in spending.

Thirdly, in the absence of a robust public healthcare system, the majority of the population will continue to rely on unregulated and exorbitantly priced private facilities. Out of pocket medical expenses already push an estimated 39 million Indians into poverty every year.

The proposed budget cut is thus completely out of sync with the extent of the disease burden in India and the global push for universal health coverage. It is also in contradiction with the Prime Minister's plan to provide all citizens with basic health services. While the move reflects the Government's struggle to achieve its 2014/15 fiscal deficit target, cutting the health budget is short-sightedness with potentially debilitating health and economic consequences for the entire population. In fact, de-prioritising public spending on health also undermines investments in other areas like education and skill development as a healthy population is a prerequisite for a productive nation.

More On This Topic