2005 Articles

Financing Health for All in India

Bajpai, Nirupam; Goyal, Sangeeta

India has set out ambitious goals for itself in the health sector in its Tenth Five Year Plan (2002-07). It is also a signatory to the United Nations Millennium Development Goals. Attainment of these goals which are time-bound will require a massive scaling up of investment in health, especially in public primary health care. We argue for a ‘Health for
All’ initiative on the part of the government akin to the ‘Education for All’ scheme which was launched nation-wide in 2001. The large amount of resources required for scaling up public investment in primary health need not be the constraint it is purported to be. We discuss several options that are available to the government for generating the necessary funds. Among the options that can generate resources domestically are reform of the government’s subsidies regime including implementing life-line tariffs, ear-marking taxes and disinvestment of loss-making public sector units.
Health for All can also be financed by raising more resources via external assistance. Official development assistance to India at present is rather low given India’s per capita income and the scale of its needs in human development terms. The scale of official development aid to India should increase several folds and committed use of funds should be made by the government in health and other priority sectors. With the 73rd and
74th amendments to the Indian Constitution which created a third tier of government comprising of elected local bodies at the village and town ward levels, a decentralized system of service delivery will eventually become a reality in India and needs to be a part of any debate on the means and modes of improving human development outcomes in
India. The current system of planning and allocation of funds at the sub-national level however needs to be over-hauled if fiscal decentralization is also to become a reality.