{"id":84880,"date":"2026-01-30T11:52:51","date_gmt":"2026-01-30T06:22:51","guid":{"rendered":"https:\/\/vajiramandravi.com\/current-affairs\/?p=84880"},"modified":"2026-01-30T11:52:51","modified_gmt":"2026-01-30T06:22:51","slug":"health-spending-by-the-centre","status":"publish","type":"post","link":"https:\/\/vajiramandravi.com\/current-affairs\/health-spending-by-the-centre\/","title":{"rendered":"Has Health Spending by the Centre Increased in India?"},"content":{"rendered":"<h2 style=\"text-align: justify;\"><strong>Health Spending Latest News<\/strong><\/h2>\n<ul style=\"text-align: justify;\">\n<li style=\"font-weight: 400;\" aria-level=\"1\"><span style=\"font-weight: 400;\">Recent data show that while States have increased health expenditure, the Union government\u2019s health spending as a share of GDP has declined in the post-pandemic period.<\/span><\/li>\n<\/ul>\n<h2 style=\"text-align: justify;\"><strong>Background: Health Financing Commitments in India<\/strong><\/h2>\n<ul style=\"text-align: justify;\">\n<li style=\"font-weight: 400;\" aria-level=\"1\"><span style=\"font-weight: 400;\">India\u2019s health financing framework has long acknowledged the need for higher public investment.\u00a0<\/span><\/li>\n<li style=\"font-weight: 400;\" aria-level=\"1\"><span style=\"font-weight: 400;\">The <\/span><b>National Health Policy (NHP), 2017,<\/b><span style=\"font-weight: 400;\"> committed to increasing total public health expenditure from 1.15% of GDP to 2.5% by 2025.\u00a0<\/span><\/li>\n<li style=\"font-weight: 400;\" aria-level=\"1\"><span style=\"font-weight: 400;\">A key pillar of this commitment was enhancing the Union government\u2019s contribution, envisaged at <\/span><b>40% of total public health spending<\/b><span style=\"font-weight: 400;\">.<\/span><\/li>\n<li style=\"font-weight: 400;\" aria-level=\"1\"><span style=\"font-weight: 400;\">However, the policy target has not been achieved. As of 2025-26, India remains significantly below the stated goals, raising concerns about fiscal prioritisation of health in national budgeting.<\/span><\/li>\n<\/ul>\n<h2 style=\"text-align: justify;\"><strong>Trends in Public Health Spending in India<\/strong><\/h2>\n<ul style=\"text-align: justify;\">\n<li style=\"font-weight: 400;\" aria-level=\"1\"><span style=\"font-weight: 400;\">India\u2019s public health expenditure remains among the lowest globally.\u00a0<\/span><\/li>\n<li style=\"font-weight: 400;\" aria-level=\"1\"><span style=\"font-weight: 400;\">Comparative data show that countries such as <\/span><b>Bhutan, Sri Lanka, Thailand, and Malaysia<\/b><span style=\"font-weight: 400;\"> spend several times more per capita on health than India. Even among <\/span><b>BRICS nations<\/b><span style=\"font-weight: 400;\">, India\u2019s per capita public health spending is markedly lower.<\/span><\/li>\n<li style=\"font-weight: 400;\" aria-level=\"1\"><span style=\"font-weight: 400;\">During the COVID-19 pandemic, public health spending as a percentage of GDP rose temporarily.\u00a0<\/span><\/li>\n<li style=\"font-weight: 400;\" aria-level=\"1\"><span style=\"font-weight: 400;\">However, this increase was driven largely by State governments, not by sustained expansion in Union government allocations.<\/span><\/li>\n<\/ul>\n<h2 style=\"text-align: justify;\"><strong>Union Government Health Spending: Declining Priority<\/strong><\/h2>\n<ul style=\"text-align: justify;\">\n<li style=\"font-weight: 400;\" aria-level=\"1\"><span style=\"font-weight: 400;\">According to Reserve Bank of India data, the Union government\u2019s health expenditure declined from 0.37% of GDP in 2020-21 to 0.29% in 2025-26 (Budget Estimates).\u00a0<\/span><\/li>\n<li style=\"font-weight: 400;\" aria-level=\"1\"><span style=\"font-weight: 400;\">In real terms, the 2025-26 health allocation is 4.7% lower than actual spending in 2020-21, after adjusting for inflation.<\/span><\/li>\n<li style=\"font-weight: 400;\" aria-level=\"1\"><span style=\"font-weight: 400;\">This decline indicates that the modest priority accorded to health during the pandemic has not been sustained.\u00a0<\/span><\/li>\n<li style=\"font-weight: 400;\" aria-level=\"1\"><span style=\"font-weight: 400;\">The share of health in the total Union Budget has also fallen from 2.26% to 2.05% during this period, signalling a relative de-prioritisation.<\/span><\/li>\n<\/ul>\n<h2 style=\"text-align: justify;\"><strong>State Governments Driving Health Expenditure Growth<\/strong><\/h2>\n<ul style=\"text-align: justify;\">\n<li style=\"font-weight: 400;\" aria-level=\"1\"><span style=\"font-weight: 400;\">In contrast, <\/span><b>States and Union Territories<\/b><span style=\"font-weight: 400;\"> have increased health spending consistently since 2017-18.\u00a0<\/span><\/li>\n<li style=\"font-weight: 400;\" aria-level=\"1\"><span style=\"font-weight: 400;\">Health expenditure by States rose from <\/span><b>0.67% of GDP in 2017-18 to 1.1% in 2025-26<\/b><span style=\"font-weight: 400;\">, with the share of health in State budgets increasing from <\/span><b>5% to 5.6%<\/b><span style=\"font-weight: 400;\">.<\/span><\/li>\n<li style=\"font-weight: 400;\" aria-level=\"1\"><span style=\"font-weight: 400;\">This trend highlights a structural imbalance: while health is primarily a <\/span><b>State subject<\/b><span style=\"font-weight: 400;\">, the fiscal capacity of States depends heavily on Union transfers. Reduced Central spending, which directly affects frontline healthcare delivery.<\/span><\/li>\n<\/ul>\n<h2 style=\"text-align: justify;\"><strong>Health and Education Cess: Limited Impact on Health Budgets<\/strong><\/h2>\n<ul style=\"text-align: justify;\">\n<li style=\"font-weight: 400;\" aria-level=\"1\"><span style=\"font-weight: 400;\">The <\/span><b>Health and Education Cess (HEC)<\/b><span style=\"font-weight: 400;\">, introduced in 2018-19 at 4% of taxable income, was intended to augment health spending.\u00a0<\/span><\/li>\n<li style=\"font-weight: 400;\" aria-level=\"1\"><span style=\"font-weight: 400;\">However, evidence suggests that cess collections have largely been absorbed into general revenues rather than used to expand health budgets.<\/span><\/li>\n<li style=\"font-weight: 400;\" aria-level=\"1\"><span style=\"font-weight: 400;\">In <\/span><b>FY 2023-24<\/b><span style=\"font-weight: 400;\">, only about <\/span><b>one-fourth of the Rs. 71,180 crore collected through HEC<\/b><span style=\"font-weight: 400;\"> was allocated to health.\u00a0<\/span><\/li>\n<li style=\"font-weight: 400;\" aria-level=\"1\"><span style=\"font-weight: 400;\">Excluding cess contributions, the Union government\u2019s health spending declined by <\/span><b>22.5% in real terms between 2020-21 and 2023-24<\/b><span style=\"font-weight: 400;\">.<\/span><\/li>\n<\/ul>\n<h2 style=\"text-align: justify;\"><strong>Cuts in Centrally Sponsored Health Schemes<\/strong><\/h2>\n<ul style=\"text-align: justify;\">\n<li style=\"font-weight: 400;\" aria-level=\"1\"><span style=\"font-weight: 400;\">Another major concern is the declining share of Union spending transferred to States <\/span><b>through Centrally Sponsored Schemes (CSS)<\/b><span style=\"font-weight: 400;\">.\u00a0<\/span><\/li>\n<li style=\"font-weight: 400;\" aria-level=\"1\"><span style=\"font-weight: 400;\">This share fell from 75.9% in 2014-15 to about 43% in 2024-25.<\/span><\/li>\n<li style=\"font-weight: 400;\" aria-level=\"1\"><span style=\"font-weight: 400;\">Key schemes such as the <\/span><b><a href=\"https:\/\/vajiramandravi.com\/upsc-exam\/national-health-mission\/\" target=\"_blank\">National Health Mission<\/a> (NHM)<\/b><span style=\"font-weight: 400;\">, which has been central to strengthening rural and urban health infrastructure since 2005, have seen stagnation or real-term declines in funding.\u00a0<\/span><\/li>\n<li style=\"font-weight: 400;\" aria-level=\"1\"><span style=\"font-weight: 400;\">During the second tenure of the NDA government, NHM spending declined by 5.5% annually in real terms, weakening public health system capacity.<\/span><\/li>\n<\/ul>\n<h2 style=\"text-align: justify;\"><strong>Implications for Public Health Outcomes<\/strong><\/h2>\n<ul>\n<li style=\"font-weight: 400; text-align: justify;\" aria-level=\"1\"><span style=\"font-weight: 400;\">Low and declining Central investment has several implications:<\/span>\n<ul>\n<li style=\"font-weight: 400;\" aria-level=\"2\"><span style=\"font-weight: 400;\">Increased <\/span><b>out-of-pocket expenditure<\/b><span style=\"font-weight: 400;\"> for households<\/span><\/li>\n<li style=\"font-weight: 400;\" aria-level=\"2\"><span style=\"font-weight: 400;\">Strain on <\/span><b>State finances<\/b><span style=\"font-weight: 400;\">, especially poorer States<\/span><\/li>\n<li style=\"font-weight: 400;\" aria-level=\"2\"><span style=\"font-weight: 400;\">Weakened preventive and primary healthcare systems<\/span><\/li>\n<li style=\"font-weight: 400;\" aria-level=\"2\"><span style=\"font-weight: 400;\">Reduced preparedness for future health emergencies<\/span><\/li>\n<\/ul>\n<\/li>\n<li style=\"font-weight: 400; text-align: justify;\" aria-level=\"1\"><span style=\"font-weight: 400;\">These trends undermine India\u2019s ability to achieve <\/span><b>Universal Health Coverage<\/b><span style=\"font-weight: 400;\"> and meet Sustainable Development Goal targets related to health.<\/span><\/li>\n<\/ul>\n<p><b>Source:<\/b> <strong><a href=\"https:\/\/www.thehindu.com\/business\/Economy\/has-health-spending-by-the-centre-increased\/article70567351.ece\" target=\"_blank\" rel=\"nofollow noopener\">TH<\/a><\/strong><\/p>\n","protected":false},"excerpt":{"rendered":"<p>India\u2019s public health spending remains low as Central government health expenditure as a share of GDP has declined.<\/p>\n","protected":false},"author":21,"featured_media":84886,"comment_status":"closed","ping_status":"closed","sticky":false,"template":"","format":"standard","meta":{"_acf_changed":false,"footnotes":""},"categories":[18],"tags":[5020,60,22,59],"class_list":{"0":"post-84880","1":"post","2":"type-post","3":"status-publish","4":"format-standard","5":"has-post-thumbnail","7":"category-upsc-mains-current-affairs","8":"tag-health-spending","9":"tag-mains-articles","10":"tag-upsc-current-affairs","11":"tag-upsc-mains-current-affairs","12":"no-featured-image-padding"},"acf":[],"_links":{"self":[{"href":"https:\/\/vajiramandravi.com\/current-affairs\/wp-json\/wp\/v2\/posts\/84880","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/vajiramandravi.com\/current-affairs\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/vajiramandravi.com\/current-affairs\/wp-json\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/vajiramandravi.com\/current-affairs\/wp-json\/wp\/v2\/users\/21"}],"replies":[{"embeddable":true,"href":"https:\/\/vajiramandravi.com\/current-affairs\/wp-json\/wp\/v2\/comments?post=84880"}],"version-history":[{"count":4,"href":"https:\/\/vajiramandravi.com\/current-affairs\/wp-json\/wp\/v2\/posts\/84880\/revisions"}],"predecessor-version":[{"id":84897,"href":"https:\/\/vajiramandravi.com\/current-affairs\/wp-json\/wp\/v2\/posts\/84880\/revisions\/84897"}],"wp:featuredmedia":[{"embeddable":true,"href":"https:\/\/vajiramandravi.com\/current-affairs\/wp-json\/wp\/v2\/media\/84886"}],"wp:attachment":[{"href":"https:\/\/vajiramandravi.com\/current-affairs\/wp-json\/wp\/v2\/media?parent=84880"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/vajiramandravi.com\/current-affairs\/wp-json\/wp\/v2\/categories?post=84880"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/vajiramandravi.com\/current-affairs\/wp-json\/wp\/v2\/tags?post=84880"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}