A healing touch from the Finance Minister

T Ramoji

On health front, contribution to enhanced national health is one of the three important principle objectives behind the proposals of the maiden budget from Mr Jaswant Singh. The other two are; easier access to health facilities to the ’disadvantaged citizens’ and the India as a health destination.

Being a combination of labour and capital-intensive, with a long gestation period, healthcare investments have so far been adversely impacted by the lack of funding options. Budget 2003 encourages the fundings for private investments and thus paves the way to the enhanced national health. This budget is indeed a healing touch for the health service sector. All well. The industry is happy; general public is happy; but what we need is to pay attention to some of the key proposals:

Mass health insurance, if we may call it so, is the real need of the day. This is the most significant step towards the national health. As sickness has no rich-poor discrimination, so should be the case for curing. The FM’s diagnosis is perfect and the prescription is apt. However, we need to see the scheme in fine print. It is important to know how easily accessible this scheme is for below poverty line families. Knowing the service standards of our public general insurance companies, one may wonder how far this will encourage the ‘disadvantaged citizens’ to avail of this facility. No budget makes any impact to the ordinary human being. Its implementation does. The FM asserts; ‘benefits are real.’ He has also suggested a marketing plan by requesting Hon. Members (of the House) to give wide publicity to their scheme in their constituencies.

Benefits under Section 10 (23) G of IT Act for the loans extended by the Financial Institutions for the hospitals is a real recognition of the importance of the role of the industry in enhancement of national health. This would bring in additional investment and enhancement of facilities in the private healthcare sector. But, why only for hospitals of 100 beds or more ? We hardly see 100 beds hospitals in most of the towns, leave alone the villages. Again, 100 beds can become a manipulative issue. Do we need such a minimal condition ? If so, it could have been minimal infrastructure facility or linked to project cost than just the number of the beds.

Increase of depreciation from 25% to 40% on medical equipment is again a gift to the ailing industry. This is required very much to enable the hospitals to upgrade their technologies faster. But, how far the tax benefits are of any significance to there placement policies of business establishments. Additional benefits should have been linked to the creation of development reserve sort of condition, which would encourage the timely upgradation of technology. Customs duty reduction from 25% to 5% on specific life saving equipment and exempting them fromadditional customs duty is a welcome move. The corporates should pass on the benefits to the end consumer by reducing the cost of providing services. Concessional customs duty on drugs of 5% isproposed to be extended to some more life saving drugs. They will also be exempt from the excise duty. This makes medication cheaper.

(The author is finance controller, Manipal Hospital, Bangalore )