Health Budget 2021 Expectations After The COVID-19 Outbreak

At the time of presentation of the Union Budget 2020, COVID-19 wasn't yet declared a pandemic. Cases were largely reported in China and seemed like a long way from home.

In the month that followed, there was a sudden turn of events and the rest is history.

No one anticipated the extent of human and economic loss from COVID-19, with India becoming the second most affected country in the world.

It is highly anticipated that the health ministry, which played the most critical role in handling the COVID-19 crisis in the country, will be amongst the major beneficiaries in the upcoming Union Budget along with the sector as a whole. PM Modi's focus on the vaccination drive is also crucial for India's road to economic growth recovery and is expected to cost the government $1.4 billion to $1.8 billion in the first phase of a coronavirus vaccination programme, even after getting support under the Covax global vaccine-sharing scheme, according to estimates by the GAVI vaccines alliance.

The immunisation programme began on 16 January and plans to cover 300 million people in the first part of the programme, kicking off with health workers, frontline staff such as police and then people over the age of 50 and those with co-morbidities.

Improvement in health infrastructure and insurance coverage

COVID-19 is still an ongoing crisis and as Finance Minister Nirmala Sitharaman prepares to present the annual budget on 1 February, there is an obvious expectation of spending to ensure better health outcomes and protect the residents of the nation from similar epidemics in the future.

"Take the opportunity of COVID-19 vaccine to establish long-lasting supply chain infrastructure: The government needs to ensure that the vaccination drive is not seen as a one-time exercise but a chance to develop infrastructure to serve the nation and its immunization targets in coming decades," Himanshu Sikka, Lead - Health, Nutrition, and WASH, IPE Global told Financial Express.

The ongoing pandemic also brought to light the need to improve the infrastructure for both the public and private sectors as well as accessibility to insurance (with the extended implementation of the Ayushman Bharat programme.

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Experts believe that with bacterial infections becoming increasingly resistant to antibiotics, common infections like the flu are becoming life-threatening. The government will have to focus on life science, healthcare and diagnostics with the help of the private sector for a healthier future.

Budget 2021 can also focus on digital transformation and innovations in the healthcare system, along with encouraging aid to R&D (research & development) facilities in the pharma sector in India, the largest provider of generic medicines globally.

Innovation

In 2020, with a sudden rise in the need for medical supplies, it became clear that innovation is critical in current times.

The life science, healthcare and pharmaceutical industry faced supply disruptions due to lockdown and other COVID-19 disruptions, which promoted the Government of India to launch the medical park and production linked incentive (PLI) scheme for promotion of domestic manufacturing of critical Key Starting Materials/Drug Intermediaries and Active Pharmaceutical Ingredients (APIs).

Budget 2021 could consider further efforts to improve innovation at a global level. Tax incentives and other initiatives could help India move from the title of a generic manufacturer to a global innovator and manufacturer.