Event Report
Sana Ansari
As part of IMPRI’s 6th Annual Series of Thematic Deliberations and Analysis of the Union Budget 2025-26, the IMPRI Center for Human Dignity and Development (CHDD) organized a thematic discussion on Population, Health, and the Union Budget 2025-26.
The discussion commenced with Ms Tanu Paliwal, a researcher at IMPRI, who introduced the chair of the program, Dr Manorama Bakshi, Director and Head of Healthcare and Advocacy at Consocia Advisory, Founder and Director of Trilok Raj Foundation (TRF), and Visiting Senior Fellow at IMPRI. She then introduced the distinguished panel of experts, which included:
- Dr Urvashi Prasad, Ex-Director, Office of Vice-Chairman, NITI Aayog
- Dr Poonam Muttreja, Executive Director, Population Foundation of India (PFI)
- Dr M R Seetharam, Advisor & Member, Swami Vivekananda Youth Movement (SVYM); Senior Orthopaedic Consultant, Vivekananda Memorial Hospital
- Dr K S Uplabdh Gopal, Associate Fellow, Health Initiative, Observer Research Foundation (ORF)
Following the introductions, Team IMPRI delivered a presentation on key budgetary insights, led by Ms Tanu Paliwal.
Opening Remarks by Dr Manorama Bakshi
The discussion began with Dr Manorama Bakshi emphasizing the central role of healthcare in India’s growth. She highlighted that healthcare is not just a policy priority but a key pillar of economic and social resilience. She mentioned that the National Health Policy 2017 envisions universal health coverage. Over the years, investments in diagnostics, genomics, precision medicine, and digital health have grown, especially after COVID-19. The integration of artificial intelligence and machine learning is transforming disease surveillance. Genomics is unlocking new possibilities in personalized medicine, and production-linked incentive schemes are fostering medical device innovation.
Dr Bakshi pointed out that India is on the path to becoming a global healthcare powerhouse. However, she stressed that sustaining progress depends on increased budget allocations, robust policy execution, and strategic investments in digital health and AI. She referred to the Ayushman Arogya Mandir website, which reports that India has operationalized 1,75,000 Health and Wellness Centers. These centers upgrade sub-centers and primary healthcare facilities to provide comprehensive primary healthcare. They cover maternal and child health, non-communicable disease (NCD) screening, essential drugs, and diagnostics. On average, each center serves 358 outpatients per month, with 128 NCD patients, accounting for 31% of outpatient care needs.
She raised concerns about whether these centers are equipped to handle the growing burden of NCDs. With India’s population projected to reach 1.5 billion by 2030, rising urbanization and an aging demographic pose additional challenges. She questioned whether the Union Budget 2025-26 is a step forward and if the allocated funds are sufficient.
Dr Bakshi provided key budget insights. The healthcare budget for 2025-26 has increased by 11%, reaching ₹1,03,851 crore, compared to ₹94,671 crore last year. However, this includes Ayushman Bharat PMJAY expenditure. Without this inclusion, the increase is around 9% to 9.1%, bringing the total to approximately ₹95,000 crore. She noted that healthcare now accounts for only 2% of the total budget, showing a declining trend compared to previous years.
She highlighted the government’s commitment to increasing medical education seats. The budget announced 10,000 new medical seats, aligning with the long-term vision of universal health coverage and the National Health Policy. Over the next five years, 75,000 additional seats are planned. In the last decade, India has added 1.1 lakh undergraduate and postgraduate seats, marking a 130% increase.
Despite these advancements, she pointed out missed opportunities. There were no major announcements on public-private partnerships in medical education, alternative financing for students, structured faculty development, or health innovation. While the “Heal in India” program was acknowledged, the lack of dedicated medical tourism zones with tax incentives leaves room for future policy interventions.
The budget’s impact on the pharmaceutical and med-tech industry was mixed. The government exempted customs duty on 36 life-saving drugs and introduced new patient assistance programs. However, critical demands such as higher R&D incentives, export promotion support, and reforms in the sector remained unaddressed.
Dr Bakshi also raised concerns about the future of digital healthcare. She stressed that while India is advancing in AI-driven healthcare, clarity on digital health initiatives is still lacking. The Ayushman Digital Mission has the potential to be a game-changer. However, to maximize AI, ML, and digital health innovations, India needs structured funding, clear regulations, and seamless integration with public healthcare infrastructure.
She outlined key discussion points for the panel:
- Is the 11% budget increase sufficient given India’s global ranking?
- How will the customs duty exemption on 36 life-saving drugs impact affordability and patient outcomes?
- Will the focus on increasing medical seats affect quality in medical education?
- Can AI, ML, and digital health solutions bridge India’s healthcare divide?
- How can public-private partnerships position India as a global medical hub?
Dr Urvashi Prasad began the discussion by stating that she is a public health professional and a policy professional. However, most importantly, she is a patient of a very rare form of lung cancer. This intersection gives her a unique perspective to share with people. She expressed concerns about the healthcare budget and stated that the current allocation is inadequate for a population of 1.4 billion. She acknowledged the argument that effective utilization of funds is important but emphasized that the overall budget amount also matters.
Discussion on Healthcare Budget and Cancer Care by Dr Urvashi Prasad
She pointed out that if the temporary increase in funding during the COVID-19 pandemic is removed, the actual rise in the healthcare budget is minimal. She noted that India has always underinvested in public health. While working at NITI Aayog, she strongly advocated for increased healthcare funding. She stressed that healthcare should be seen as an investment rather than an expenditure. A healthy workforce is essential for building a developed economy and a productive society. Although health is a state subject, she believes the central government must take greater responsibility in strengthening the sector.
Dr Prasad also spoke about the proposed district-level cancer care centers. She stated that having such centers would reduce the burden on major cities like Delhi and Mumbai. It would also improve accessibility and affordability for patients. However, she emphasized that successful implementation is crucial. She raised concerns about the availability of trained personnel, the supply chain for medicines, and the range of services to be provided. She pointed out that past initiatives, such as district-level dialysis centers, faced significant challenges in implementation.
She highlighted issues with the Ayushman Arogya Mandirs. While official reports show high numbers of screenings, there are gaps in quality and follow-ups. She stressed the importance of systematic screening and proper referral mechanisms. She also noted that reducing customs duties on cancer drugs is a positive step. However, the high cost of treatment remains a major issue. Even after cost reductions, many drugs remain unaffordable for most patients. She called for a detailed review of drug pricing and patient assistance programs, which often fail to benefit the poor.
Dr Prasad concluded by emphasizing the need for a comprehensive cancer care program. She argued that cancer treatment should not be addressed through scattered schemes but through a well-structured approach. She called for holistic policies that cover prevention, screening, diagnosis, treatment, and rehabilitation. She reiterated that healthcare funding and policy decisions should focus on long-term benefits for the population and the economy.
Critical Analysis of India’s Medical Education & Medical Value Tourism by Dr K S Uplabdh Gopal
Dr K. S. Uplabdh Gopal critically analyzed the recent announcements regarding medical education and healthcare infrastructure, highlighting key gaps and concerns. He pointed out that while the addition of 10,000 new medical seats and the long-term goal of 75,000 seats seem promising, the real challenge lies in maintaining quality.
The rapid expansion of medical colleges—from about 400 a decade ago to nearly 780 today—has not been matched by a proportional increase in faculty availability. This has led to issues such as ghost faculty, where doctors are listed as teaching staff on paper but do not actually teach. He further noted that India is experiencing a shortage of qualified medical educators, as many professionals opt for higher-paying opportunities abroad, particularly in OECD countries. The problem is exacerbated by regional disparities, with nearly 51% of undergraduate (UG) and 49% of postgraduate (PG) seats concentrated in South India, leaving other regions underserved.
Dr Gopal also raised concerns about the high cost of medical education, especially in private colleges, where fees range from ₹60 lakh to ₹1 crore. He observed that this forces many students to pursue medical degrees abroad in countries like Russia, China, and Ukraine, only to struggle with licensing exams upon their return. Despite the government’s push to expand medical seats, he emphasized that without faculty investment, structured training programs, and equitable distribution of medical institutions, the healthcare system would continue to face systemic weaknesses.
Turning to healthcare infrastructure, Dr Gopal noted that budget allocations do not align with the National Health Policy (NHP) 2017, which recommended that two-thirds of the health budget should go towards primary healthcare. Instead, a significant portion is still directed towards tertiary care, such as AIIMS expansion and specialty hospitals, while Primary Health Centers (PHCs) and Community Health Centers (CHCs) remain underfunded.
The Ayushman Bharat budget has increased to ₹9,400 crore, largely due to expansion for citizens above 70 years old, while the PM Ayushman Bharat Health Infrastructure Mission received ₹4,200 crore. However, he pointed out that several PHCs and CHCs still lack basic amenities, including electricity, and are not adequately staffed. He further noted that preventive healthcare measures, such as vaccination programs, were largely ignored in the budget, despite their long-term cost-effectiveness. He specifically mentioned the HPV vaccination for cervical cancer prevention, which has been a recent focus of government initiatives but did not receive budgetary support this year.
In discussing potential solutions, Dr Gopal stressed the need to increase the allocation for NHM and primary care from the current ~40% to at least 60%. He emphasized that India must prioritize preventive healthcare, improve PHC and CHC functionality, and restructure medical education financing by offering subsidized loans and interest waivers to reduce the financial burden on students. He also pointed out that public-private partnerships (PPPs) could play a key role in expanding medical colleges to underserved areas, reducing the current geographic imbalance in medical education.
When addressing PPPs in healthcare, Dr Gopal acknowledged that some successful models exist, such as private sector-led diagnostic services in government hospitals and telemedicine initiatives in rural areas under BharatNet expansion. He noted that COVID-19 vaccine manufacturing under PPPs was a major success, yet this year’s budget did not announce any major PPP initiatives for medical education or district hospitals. He argued that while infrastructure takes time, strengthening district hospitals through PPPs could ease the burden on AIIMS and tertiary care centers.
However, he also highlighted that out-of-pocket healthcare expenditure remains high at nearly 40%, and the budget did not address tax reductions on health insurance premiums, which could have helped reduce financial strain on middle-class families. He further added that artificial intelligence and big data could improve efficiency in healthcare, but data privacy concerns must be addressed first.
On medical value tourism (MVT), Dr Gopal noted that India has been a preferred destination for medical tourists due to its high-quality yet cost-effective healthcare services. However, he cautioned that India is losing ground to competitors like Turkey and Dubai, which have been investing heavily in healthcare infrastructure and branding. He highlighted that the global medical tourism market is expected to grow at ~25% CAGR between 2023 and 2030, presenting a major opportunity for India. However, to stay competitive, the government must streamline medical visa policies, improve infrastructure, and market India’s strengths in affordable and high-quality treatment.
In conclusion, Dr Gopal emphasized that simply increasing the number of medical seats is not enough—there must be a parallel investment in faculty development, equitable expansion of institutions, PPP-based improvements in district hospitals, and a strong focus on primary healthcare. Without these measures, India’s healthcare system will continue to be overburdened, and regional disparities in medical education and service delivery will persist. Additionally, he called for strategic branding and policy interventions to restore India’s competitive edge in medical tourism, ensuring that India remains a leading destination for global healthcare seekers.
India’s Healthcare Expenditure and Demographic Challenges: A Call for Policy Reform by Dr Poonam Muttreja
Dr Poonam Muttreja highlighted critical concerns regarding India’s health expenditure, noting that it remains at a mere 1.3% of GDP, far below the targeted 2.5%. Budget increases fail to account for inflation and population growth, limiting healthcare improvements. Addressing maternal and reproductive health, she emphasized that 50% of India’s population is in the reproductive age group, with every fifth Indian being an adolescent (10-19 years old). While India has reduced maternal and infant mortality rates—MMR dropped from 130 (2014-16) to 97 (2018-20) per 100,000 live births, and IMR fell from 40 (2013) to 28 per 1,000 live births—access to maternal healthcare remains uneven, especially for marginalized communities like Scheduled Castes and Scheduled Tribes (SC/ST).
A major concern is anemia among women, with 57% of women aged 15-49 years being anemic, alongside 24 million women (9.4%) having an unmet need for family planning (NFHS-5). Despite these challenges, the National Health Mission (NHM) budget increased by only 3.4%, with family planning and family welfare schemes receiving marginal hikes. While new contraceptives like injectables and implants were introduced after three decades, they are available in only 10 states due to financial constraints. Dr Muttreja stressed that family planning should be integrated into Universal Health Coverage (UHC) rather than treated as a standalone program. Although investments in health infrastructure are increasing, reproductive healthcare remains overlooked, despite being central to primary healthcare.
On population trends, she emphasized that India’s fertility rate has already dropped below replacement level (TFR = 2.0). Projections indicate that India’s population will peak at 1.69 billion by 2063 (UN estimate) or at 1.6 billion by 2048 (University of Washington), before declining to 1.1 billion by 2100.
Given this trajectory, she argued for a shift in focus from “population control” to “population stabilization” by addressing unmet family planning needs. She also highlighted the demographic shifts expected by 2050, where the elderly population will double to 20%, with the 80+ age group increasing by 280%. This requires differentiated policy approaches—southern states must focus on elderly care, while northern states like UP, Bihar, and Assam need improvements in family planning, education, and skilling. With migration becoming a significant factor, policies must integrate migrant workers into healthcare and social security systems.
Dr Muttreja concluded that for India to achieve its “Viksit Bharat 2047” vision, investments in youth skilling, women’s health, and elderly care are essential. Without substantial investments in maternal and child health, sexual and reproductive health, and geriatric care, India risks losing its demographic dividend. Economic growth must be accompanied by human development to ensure a healthy, skilled, and productive workforce for the future.
Enhancing Budget Utilization and Intersectoral Collaboration for Effective Development by Dr M. R. Seetharam
Dr M. R. Seetharam spoke about two key components of budget utilization. The first is appropriate allocation and the second is ensuring that the allocated budget is used with the right intention. He emphasized that both elements must be respected to achieve positive outcomes.
He noted that in development work across various departments, the focus is often more on allocation than on intention. The amount allocated for capital investment is tracked closely. However, the actual impact on the intended beneficiaries is often overlooked. The effectiveness of budget utilization depends on both financial spending and the realization of intended goals.
Dr Seetharam pointed out a common issue in budget utilization. Many departments delay spending until the end of the financial year. In the last few months, they rush to exhaust the allocated funds. This practice does not translate into meaningful impact. To address this, he suggested spreading the expenditure throughout the year while considering regional and seasonal factors. Converting budget allocations into actionable grassroots plans is crucial.
He highlighted the multi-step process involved in fund allocation. The Union Budget releases funds to states. States then contribute their share before the funds reach the district level for implementation. Each stage faces challenges that must be addressed to ensure smooth budget utilization. Regular monitoring, mid-term reviews, and evaluation mechanisms must be strengthened. A system should be in place to identify projects that are delayed or not progressing as planned. This will help in taking timely corrective measures.
Dr Seetharam stressed the importance of good governance. Transparency, disclosures, and decentralization are essential for effective budget utilization. He explained that health is influenced by multiple factors beyond disease control. Sectors such as water supply, sanitation, and nutrition play a crucial role in public health. Interministerial collaboration is necessary to address these determinants.
He gave the example of the Swachh Bharat Mission and the Jal Jeevan Mission. Both programs have received significant financial support. However, their success depends on effective convergence. If sanitation goals under the Swachh Bharat Mission are achieved and clean drinking water flows through pipes under the Jal Jeevan Mission, public health outcomes will improve significantly.
Dr Seetharam also spoke about the role of youth in nation-building. Adolescents and young adults are vulnerable to various risks, including addiction. The first exposure to addictive substances often happens during adolescence. He suggested stronger collaboration between the Health Ministry and the Ministry of Youth Affairs. Joint efforts can create impactful interventions to prevent addiction and promote positive engagement.
He emphasized the role of youth organizations like NSS and NCC in spreading awareness and bringing behavioral change. In addition to substance abuse, new challenges such as social media and device addiction are emerging. These issues contribute to mental health problems and social unrest. Addressing them requires coordinated efforts from multiple departments.
Dr Seetharam concluded by stressing the need for interministerial partnerships. Policies should promote collaboration at all levels. However, the real challenge lies in translating policy commitments into on-ground action. To improve budget utilization, departments must focus on both financial spending and achieving intended impacts. Strengthening partnerships and ensuring accountability will enhance the effectiveness of government programs.
IMPRI’s 6th Annual Series of Thematic Deliberations and Analysis of Union Budget 2025-26
IMPRI’s 6th Annual Series of Thematic Deliberations and Analysis of Union Budget 2025-26
Population, Health, and Union Budget 2025-26
Acknowledgement: This article is written by Sana Ansari, a visiting researcher at IMPRI, who is currently pursuing her first year of a Master’s in Public Policy at St. Xavier’s College, Mumbai.
