Technology czars analyse the Union Budget
Budget 2020 is visionary and in accordance with the policy of improving and expanding healthcare services reach to all
Nalinikanth Gollagunta, Managing Director, Wipro GE Healthcare
I would like to congratulate the Finance Minister on presenting a holistic budget specially from the perspective of enhancing access to healthcare in the country. The increased allocation to healthcare and specific focus on addressing the healthcare infrastructure gap specifically in tier 2 and tier 3 cities through PPP mode hospitals being planned to be set up under viability gap funding will significantly help us achieve our goal of Ayushman Bharat. Elimination of Dividend Distribution Tax along with incentives directed towards medical devices companies under electronics manufacturing will a big push towards 'Make in India' efforts for medical technology.
Chairman & Managing Director
Looks like a good budget for healthcare sector but with crucial lacunae still not addressed. Allocation of Rs 69,000 crores to healthcare sector is surely a welcome step, including the new “TB harega, Desh jeetega” project to eradicate TB by 2025.
It’s good to know that the government plans to expand the Jan Aushadi Kendras to all districts to provide medicines at affordable rates. On the same lines, the government needs to develop some mechanism that provides affordable diagnostics as well.
The Finance Minister's announcement of allocating Rs. 3000 crore towards skill development is a greatly welcome move. This will address shortage of skilled manpower crucial for penetration of diagnostic centres in rural India. It is also in line with Transasia's own skill development projects under way in the country.
However, the budget doesn't address some of the immediate concerns of the Indian families with respect to medical costs and expenditures. The diagnostic segment, which is taxed much higher than medical services, needed relief by reducing their tax bracket. That has not been done and resultantly the common man will continue to spend high amounts on basic and advanced diagnostic tests.
While it is good that the government recognizes entrepreneurship as the strength of India and has proposed various schemes that will encourage Make in India and exports, however, important reforms needed to boost manufacturing in India have been left out of the budget.
We have been demanding reduction in the GST rate on medical supplies, diagnostic equipment, and devices from the current 18 percent to 5 percent. That would have helped in making affordable healthcare a reality.
Also, the issue of import duty tariff has not been addressed. India's import duty is the lowest among BRIC countries, at zero to 7.5 percent - making it cheaper to import devices rather than encouraging home grown, cutting edge technology Indian devices. We had demanded the duty to be raised to 15-20 per cent, as lower import duties dissuades manufacturers from producing them in India.”
Shravan Subramanyam, Managing Director, India and Neighbouring Markets, Roche Diagnostics India
The healthcare proposals of Union Budget 2020 though titled ‘Caring India’ is a mixed bag. While the marginal increase in healthcare allocation to INR 69000cr (from the past year's Rs 62,000 crore) is welcome, it still is a very small percentage of our GDP and does not supplement the Government's plans to enable affordable and accessible healthcare to all in the country.
The proposal to establish hospital infrastructure across select districts under the PPP model can help provide access to formal healthcare to millions of patients, who today travel far to avail of basic hospital care. The partnership-driven approach is a sure step for the entities to bring to these hospitals their inherent areas of strength, thus building a quality model of care. This also allows the private sector to take part in addressing the health needs of the country more effectively. It is imperative that implementation quality and timelines meet the intent of this proposal.
In this context, the proposal to introduce a health cess on import of medical equipment does not fit the narrative. Currently, the Indian medical devices industry draws on the strengths of international technology to a large extent. The healthcare spends burden on the common Indian almost instantly tends to increase with this cess, in an almost completely out-of-pocket market that India is still. It is my expectation and belief that the Finance Minister adopts a consultative approach building in recommendations from the industry and patient voices before this is implemented.
Rajiv Nath, Forum Coordinator, Association of Indian Medical Device Industry (AiMeD)
Two years back Finance Minister announced duty increased to 10% up from 7.5% and in evening we saw notification reversing this to 7.5% . This year FM announces taxation will drive public healthcare funding but the fine print states it as cess so if duty on a device was 5% it becomes 5.25 % effectively ! Only a meagre increase of 0.25% to protect domestic manufacturing and motivate traders to become manufacturers.
AIMED after going through the fine prints of the budget finds out that only a meagre increase of 0.25% is given whereas the Medical Devices Industry thought 5 % cess on Basic so it’s 5+ 5 = 10%
Today when India faces the coronavirus epidemic what’s India’s preparedness and health security of our country? 60% of gloves we consume, we import even if we are the 4th largest latex - rubber producing nation in world. Our own manufacturers import non sterile latex examination gloves and market these under their brands - not a single manufacturer bothers to produce these low priced examination gloves if the duty on these is zero %. Tomorrow if China can’t supply due to factories being shut and Malaysia has to give priority to China, India does not have the capability to take care of health security of its citizens due to such apathy to protect its manufacturing. Similar is the case of many other medical devices whether thermometer or hot water bottle or adhesive bandages.
We were expecting the government to move forward on promised reforms and anticipated conducive measures to boost domestic manufacturing of the medical devices. It is frustrating that against our expectations, the government has not included any measures to help end the 80-90% import dependence forced upon us and an ever increasing import bill of over Rs. 38,837 Crore & promoting growth Indian Medical Device industry.
Dr GSK Velu, Chairman & MD, Trivitron Healthcare
Budget 2020 is visionary and in accordance with the policy of improving and expanding healthcare services reach to all. Make in India initiative for Medical devices industry has been given a big boost. Imposing health cess on the import of medical devices will help domestic manufacturing companies.
Further, using tax proceeds to fund the creation of healthcare infrastructure will help in address issues of capital requirements for building healthcare infra in Tier- I & II cities.
The government is focused on creating the healthcare infrastructure and invest extensively in improving healthcare services in tier I-II cities in the country. Announcement of extending the ambit of Ayushman Bharat through the establishment of PPP model hospitals in 112 new districts of India will improve healthcare infrastructure.
Increasing the budgetary allocation for the healthcare sector to 69,000 crores will enhance primary health coverage and strengthen health and wellness centers (announced under Ayushman Bharat) which will help to reduce the disease burden.
Chander Shekhar Sibal, Senior Vice President, Fujifilm India
We congratulate the government on presenting the Union Budget 2020 for the common man and it’s encouraging to see that the government has taken the lead to deliver on its promise of excellence in healthcare. The government’s “TB Harega, Desh Jeetega" initiative to eradicate tuberculosis by 2025 is a significant step towards building a healthy Society. India being the highest recorder of TB cases in the world makes it imperative for us to understand the high risk of catching the disease. The government’s vision aligns with our mission to raise consciousness and promote advanced diagnosis and treatment of tuberculosis among patients. Additionally, the government’s impetus on boosting the domestic manufacturing of electronics and medical devices in the country will reinforce the commitment towards raising awareness for early detection in India. Apart from this, the announcement to boost Artificial Intelligence is a great step to strengthen the usage of technology in the field of healthcare while intensifying the quality with accessibility and affordability. We believe that the government has put forward a progressive budget with a strong vision to take India’s social, economic and overall well-being to greater heights.