Current Affairs of 18 August 2026

Taxing ‘Frivolous’ Industries Will Not Fund India’s Science

Context

• India’s scientific research faces persistent funding constraints, often prompting calls to tax profitable non-essential industries such as cinema, tourism, apparel and professional sport.
• Though seemingly attractive, this approach rests on the mistaken assumption that economic wealth is a fixed resource.
• A stronger solution lies in improving the efficiency of existing public expenditure, removing bureaucratic barriers and encouraging private and international investment in science.

A Flawed Proposition

• Taxing industries such as the IPL assumes that their profits come at the expense of scientific funding. This ignores the economic cascade effects of commercial activity.
• Organised sport generates employment in broadcasting, merchandise, food services, physiotherapy, rehabilitation and sports science.
• Cinema, tourism and manufacturing similarly create extensive economic networks.
• Science and commercial industries are also interdependent. Films require computing, optics and engineering; textiles depend on chemistry and materials science; sport increasingly uses biomechanics, medicine and nutrition.
• Thus, economic progress is not a zero-sum game in which the growth of one sector necessarily harms another.

The Problem of State Allocation

• Even if additional taxes generated revenue, efficient allocation would remain difficult.
• Government expenditure involves competing public priorities, including science, healthcare, education, infrastructure and public safety.
• The problem becomes more complex within science itself. Decisions must be made about disciplines, institutions, infrastructure and research priorities.
• Determining productivity and distributing funds can create bureaucratic discretion, institutional rivalry and conflicts of interest.
• Government subsidies also inevitably carry conditions, reducing the autonomy researchers expect from public funding.

What Is Allowed Instead of What Is Needed

• India’s research system frequently divides funds into rigid categories such as equipment, electronics, consumables and travel.
• Such classifications can prevent laboratories from spending money where it is actually needed.
• This creates a damaging incentive: researchers may purchase what is permitted rather than what is scientifically necessary, particularly before the end of a financial year.
• Fear of losing unspent funds can further encourage wasteful expenditure.
• Consequently, scientists spend valuable time navigating procurement procedures instead of conducting research.
• Such bureaucratic distortions resemble the inefficiencies associated with the former Licence Raj.

Necessary Steps Towards Meaningful Reforms

• Structural Reforms Are More Important Than New Taxes

  • The priority should be to improve the use of existing resources.
  • Greater flexibility in research funding would allow scientists to respond to changing experimental requirements without excessive administrative intervention.
  • Recruitment procedures also require reform.
  • Outdated regulatory structures can make Indian institutions less attractive to talented researchers and contribute to the loss of scientific talent overseas.
  • Reducing GST and import duties on scientific equipment would further lower the cost of research.
  • Many specialised instruments cannot be procured domestically at the required quality or scale, making affordable global access essential for competitive research.

• Encouraging Private and Foreign Investment

  • India should develop a diversified science-funding ecosystem involving government, industry, philanthropy, universities and international institutions.
  • Excessive CSR compliance requirements can encourage companies to support short-term, low-risk projects rather than ambitious research.
  • Similarly, complicated procedures for foreign contributions discourage laboratories from accessing international resources.
  • Private endowments can provide greater accountability because donors and institutions have a direct interest in research outcomes.

• Rethinking Import Substitution and Procurement

  • Domestic manufacturing should be encouraged without compromising scientific quality.
  • Import substitution can become counterproductive when protection from global competition reduces incentives to develop world-class products.
  • Rigid procurement systems can similarly force researchers to choose cheaper but inferior equipment.
  • Scientific research requires precision, reliability and technological quality, not merely the lowest nominal price.
  • Procurement rules should therefore encourage competition, innovation and performance.

The Way Forward

• India needs to remove institutional bottlenecks rather than impose punitive taxation.
• Flexible grants, competitive procurement, lower taxes on scientific equipment, easier access to foreign funding and greater private participation can strengthen the research ecosystem.
• Successful industries should not be treated merely as convenient sources of additional revenue.
• They create employment, investment, innovation and tax revenues while contributing to wider economic growth.

Conclusion

• India’s scientific challenge is not simply a shortage of money but an institutional and structural problem.
• Taxing sport, entertainment or other successful industries does little to resolve inefficient procurement, rigid funding categories or barriers to private investment.
• A stronger strategy requires greater institutional autonomy, efficient public spending, lower research costs and diversified funding.
• Economic growth and scientific advancement should be viewed as complementary rather than competing objectives.
• India can become a global scientific leader by removing the barriers that prevent existing capital, talent and knowledge from being used effectively.

Taxing ‘Frivolous’ Industries Will Not Fund India’s Science FAQs

Q1. Why is taxing profitable industries to fund science considered flawed?
Ans. It wrongly assumes that economic growth in one sector comes at the expense of another.

Q2. What is a major problem with government funding for science?
Ans. Rigid bureaucratic rules often prevent scientists from using funds according to actual research needs.

Q3. How can India reduce the cost of scientific research?

Ans. India can reduce GST and import duties on scientific equipment.

Q4. Why should private and foreign investment in science be encouraged?
Ans. They can diversify research funding and reduce excessive dependence on government grants.

Q5. What is the best way to strengthen Indian science?
Ans. India should remove bureaucratic bottlenecks, increase institutional autonomy and encourage diversified funding.

Source: The Hindu

How AI Can Be Optimised for Better Healthcare 

Context

• Modern medicine possesses enormous knowledge, but ensuring that this expertise reaches patients at the right time remains a major challenge.
• Access traditionally depends on trained clinicians, healthcare institutions and connecting systems, all of which are difficult to expand rapidly.
• For India, where healthcare capacity is expanding alongside a complex disease burden, Artificial Intelligence (AI) offers a new possibility: extending medical expertise without proportionately increasing human resources.
• AI is increasingly entering diagnosis, consultations and hospital operations. The challenge is to make these systems reliable, safe, affordable and clinically appropriate for routine use.

Expanding the Reach of Medical Expertise

• AI can narrow the gap between medical knowledge and its availability at the point of care.
• By January 2025, the S. FDA had authorised more than 1,000 AI-enabled medical devices, particularly in areas such as radiology and cardiology.
• The U.K. NHS has also introduced AI-enabled ambient scribing to reduce administrative workloads.
• For India, this transformation is particularly important because specialist healthcare remains concentrated in major cities, while smaller towns and rural areas often face shortages of specialised expertise.
• AI can help prioritise medical scans, identify deteriorating patients and assist doctors in complex cases.
• Its greatest value may therefore lie in multiplying the productivity of existing healthcare professionals.

The Economic Benefits

• India faces rising patient volumes, chronic diseases and limited clinical capacity. AI can improve efficiency by reducing time spent on repetitive administrative and operational tasks.
• India has already established a strong digital foundation. By May 2026, more than 100 crore health records had been linked to Ayushman Bharat Health Accounts.
• The Ayushman Bharat Digital Mission's Scan and Share service has also reduced outpatient registration waiting times dramatically.
• AI can extend these gains to appointment scheduling, clinical documentation, claims processing, inventory management and discharge procedures.
• A January 2026 McKinsey analysis estimated that AI could reduce healthcare revenue-cycle collection costs by 30% to 60%.
• Such savings can release resources for doctors, nurses, equipment and infrastructure while reducing administrative burdens and staff fatigue.

Beyond Hospitals: New Healthcare Models

• Remote monitoring can maintain patient connectivity after discharge, while AI-supported preventive programmes can identify high-risk individuals before their conditions become severe.
• Virtual specialist support can connect smaller hospitals with experts elsewhere, while AI-assisted diagnostics can bring advanced medical capabilities closer to underserved communities.
• Patients with diabetes, cardiovascular disease and cancer could benefit from continuous monitoring rather than relying solely on episodic hospital visits.
• This can shift healthcare from a reactive approach towards early detection, prevention and continuous disease management.
• Healthier populations are more productive, require fewer costly interventions and enjoy better quality of life, creating substantial economic benefits.

The Need for Judicious Use

• AI should not be adopted indiscriminately. Effective healthcare AI requires clinical validation, representative data, human oversight and continuous evaluation.
• A system performing well in one hospital or population may not produce similar results elsewhere because India's States differ in demographics, disease patterns, infrastructure and healthcare access.
• AI performance can also change as patient populations and clinical practices evolve.
• Therefore, healthcare systems must continuously monitor AI tools rather than assume that effectiveness at launch guarantees long-term reliability.
• The FDA's efforts to improve real-world evaluation of AI-enabled medical devices underline the importance of this approach.
• Since healthcare decisions directly affect human lives, patient safety and accountability must take precedence over technological enthusiasm.

AI as an Instrument of Inclusive Development

• India does not need AI everywhere. It needs AI where it can reduce delays, improve clinical decisions, expand access and prevent avoidable deterioration.
• Responsible integration should therefore take priority over indiscriminate deployment.
• Healthcare is fundamental to economic development because national prosperity ultimately depends on the health, longevity and productivity of people.
• India's next phase of development will require not only physical and digital infrastructure but also stronger human capital.
• AI can support this transformation by making medical expertise more accessible, improving operational efficiency and strengthening preventive and continuous care.

Conclusion

• The success of AI in healthcare should not be measured by the number of algorithms or hospitals using it, but by better patient outcomes.
• Its real impact will be visible when patients receive timely diagnosis, doctors gain more time for meaningful care, specialist expertise reaches smaller communities and preventable deterioration is reduced.
• With efficiency, equity, clinical responsibility and human oversight, AI can help transform Indian healthcare from a largely reactive system into one focused increasingly on anticipation, prevention and continuous management.
• Its ultimate economic return will lie in healthier citizens, greater productivity, longer lives and improved human well-being.

How AI Can Be Optimised for Better Healthcare FAQs

Q1. What is the main potential of AI in Indian healthcare?
Ans. AI can extend medical expertise and improve access to healthcare.

Q2. How can AI benefit healthcare economics?
Ans. AI can reduce administrative costs and improve the efficiency of healthcare services.

Q3. How can AI improve healthcare beyond hospitals?
Ans. AI can enable remote monitoring, preventive care and virtual specialist support.

Q4. Why should AI be used cautiously in healthcare?
Ans. AI requires clinical validation, representative data and human oversight to ensure patient safety.

Q5. How should the success of healthcare AI be measured?
Ans. Its success should be measured by better patient outcomes, wider access and improved human well-being.

Source: The Hindu