Union Budget 2021 Explained: Decoding The 137 Per Cent Increase In Health Expenditure

Union Budget 2021 Explained: Decoding The 137 Per Cent Increase In Health Expenditure

While presenting the Union Budget 2021-22, Finance Minister Nirmala Sitharaman announced an increase in the outlay for health by 137 per cent, what does it mean and which areas are likely to benefit
Features, Health, News, Swasth India
- in Features, Health, News, Swasth India
Union Budget 2021 Explained: Decoding The 137 Per Cent Increase In Health ExpenditureWhile presenting the budget, Finance Minister Nirmala Sitharaman said, "Taking a holistic approach to Health, we focus on strengthening three areas: Preventive, Curative, and Wellbeing"
  • Centre has allocated Rs. 73, 932 crore to Union Health Ministry
  • Budget for MoHFW is same as last year after adjusting for inflation: Expert
  • Primary healthcare in urban require more attention: Experts

New Delhi: According to experts, ‘Health’ is one of those sectors that has been consistently underfunded. However, in Budget 2021-22 presented on February 1, Union Finance Minister Nirmala Sitharaman announced an increase in the allocation for health by 137 per cent to Rs. 2.23 lakh crore (Rs. 2,23,846 crore) from the previous year’s budget estimate of over Rs. 94,000 crore (Rs. 94,452 crore) and by 118 per cent from the previous year’s revised budget of over Rs. 1.02 lakh crore (Rs. 1,02,873 crore). So which are the core areas that will witness these extra allocation and what are the possible implications? Experts analyse.

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Budget Allocated For Health And Wellbeing

In Budget 2021, apart from the allocation made for the Ministry of Health and Family Welfare (MoHFW) which is the nodal ministry for healthcare in the country, the 2.23 lakh crore expenditure also includes allocations to the Ministry of Ayurveda, Yoga and Naturopathy, Unani, Siddha and Homoeopathy (AYUSH). The Finance Minister has clubbed the amount allotted under various heads of other ministries as well to calculate the expenditure for health and wellbeing. These include: the entire budget for the Department of Drinking Water and Sanitation (D/o W&S) under the Ministry of Jal Shakti, the budget allocated for POSHAN Abhiyaan (or National Nutrition Mission) under the Ministry of Women and Child Development (MWCD), Finance Commission (FC) grants for Drinking water and sanitation and health and the one time grant for COVID-19 vaccines. Explaining the reason behind clubbing the budget allocated for different ministries under “health and wellness expenditure”, the Ministry of Finance said to NDTV,

Expenditure with explicit linkages to health and wellbeing have been included in the financials.

Union Budget 2021 Explained: Decoding The 137 Per Cent Increase In Health Expenditure
Budget for health and wellbeing has increased by 118 per cent from Rs. 1.02 lakh crore in 2020-21 Revised Estimate to Rs. 2.23 crore in 2021-22 Budget Estimate

Acknowledging the attention given to health and wellbeing in the budget, Dr Harsh Vardhan, Union Health Minister said,

The allocated budget will be of immense help to the country at this critical juncture when it is dealing with the worse pandemic humans have seen in 100-years.

Nitin Gadkari, Minister of Road Transport and Highways and Micro, Small and Medium Enterprises also lauded the budget 2021 for increasing allocation for health. He said,

The health budget has increased by 137 per cent and now Rs. 2.23 lakh crore will be spent on health services. This massive investment will strengthen the country’s healthcare services, considering the difficulties that each citizen has to face during COVID-19 pandemic.

Also Read: Budget 2021: Experts Analyse What The Budget Did For Food And Nutrition Schemes

However, if one deep dives into the numbers, one finds that the budget allocated for health (which includes MoHFW and MoAYUSH) has seen only 11.42 per cent increase. MoHFW has been allocated a sum of Rs. 73,932 crore which is about 10.16 per cent more than the Budget Estimate of Rs. 67,112 crore for FY 2020-21 but it has decreased by almost 11 per cent when compared to the Revised Estimate for the same year. This, according to Dr Dileep Mavalankar, Director, Indian Institute of Public Health, Gandhinagar, is not an adequate increase. He said,

The budget for MoHFW is practically same after adjusting for inflation.

Further breakdown of the budget for MoHFW shows that the largest chunk of the allocated sum goes to the National Health Mission (NHM) which is Rs. 36,575.5 crore or 49.47 per cent of the MoFW allocation. Out of this, Rs. 30,100 crore goes to the National Rural Health Mission (NRHM) and Rs. 1,000 crore goes to National Urban Health Mission (NUHM).

National Health Mission has seen a marginal increase of 9.5 per cent when compared to the budget estimate of Rs. 33,400 crore in 2020, that is only 4 per cent when compared to RE of the same year of Rs. 35, 144 crore.

According to Ravi Duggal, Country Coordinator, International Budget Partnership, while an increase in NHM is good, the attention being given to the National Urban Health Mission in comparison to National Rural Health Mission is extremely insufficient. He said,

National Urban Health Mission under which comes the primary healthcare in urban areas desperately needs more investment. There are hospitals and clinics in cities but there are hardly any primary healthcare centres (PHCs) or community healthcare centres of dispensaries that provide medicines at low cost. Thus, making primary health services costly in cities and unaffordable for many, especially those living in slum areas or have low income. Much more investment and interventions are required to strengthen the primary health services.

Union Budget 2021 Explained: Decoding The 137 Per Cent Increase In Health Expenditure
Budget allocated for major schemes and programmes under the Ministry of Health and Family Welfare

Budget under Pradhan Mantri Swasthya Suraksha Yojana (PMSSY) which comprises setting up of new AIIMS (All India Institute of Medical Sciences) and upgradation of existing Government Medical Colleges has been reduced by Rs. 517 crore from Rs. 7,517 crore in RE 2020-21 to Rs. 7,000 crore in BE 2021-22.

Allocation under Ayushman Bharat or the Pradhan Mantri Jan Arogya Yojna (PMJAY) has more than doubled from Rs. 3,100 crore in RE 2020-21 to Rs. 6,400 in BE 2021-22.

Budget for National AIDS (Acquired Immunodeficiency Syndrome) and STD (Sexually Transmitted Diseases) Control programme has remained unchanged at Rs. 2,900 crores which, according to experts, should have been increased as AIDS is another epidemic that the country is fighting and the services WERE DISRUPTED due to the ongoing COVID-19 pandemic. Experts feel that there was a need to increase the support to patients and the people at high risk of contracting these diseases.

The Finance Minister, in her budget speech, announced a new centrally sponsored scheme called Prime Minister Atmanirbhar Swasth Bharat Yojna to be launched with an outlay of about Rs. 64,180 crore over six years as additional to the NHM budget. However, no fund has been allocated for the scheme in Budget 2021 as of now and this is not included in the Rs. 2.23 lakh outlay for the health budget.

The FM has also announced that Pneumococcal Vaccine which is presently limited to only five states will be rolled out across the country. This will avert more than 50,000 child deaths annually, said Ms. Sitharaman.

Also Read: Budget 2021: Experts Analyse Budget Allocations For Clean Air Initiatives

According to Richa Chintan, member Jan Swasthya Abhiyan (JSA), a provision of Rs. 14,217 crore was made for COVID-19 Emergency Response and Health System Preparedness Package during last year which has reflected in the RE of 2020-21. But it is to be noted that this allocation has not been made for 2021-22 even though the pandemic is still raging and there is still a long way to overcome it which is why the absence of this allocation in the health budget is surprising, she said. The government has allocated a special grant of Rs.35,000 crore earmarked for COVID-19 vaccines which is a one-time spend, just like the COVID-19 emergency response allocations in 2020-21 and not an integral part of the health budget, according to Ms. Chintan.

However, as per the Ministry of Finance, in Financial Year 2019-20, when there was no scheme Rs.1,557 crore was made available to States and other agencies to tackle COVID 19 within the MoHFW demand head which included an amount of Rs. 358 crore from NDRF (National Disaster Relief Fund). It added that permissions were provided to ministries/departments to make re-appropriations at their level. The Ministry of Finance further said,

In FY 2021-22, under various schemes/projects such as National Health Mission, National Centre for Disease Control (NCDC), Indian Council Of Medical Research (ICMR), Hospitals, etc. adequate provisions have been kept to finance the resources required for COVID19.

There are two additional one-time allocations for healthcare in 2021-22, which are not part of the main budget of the MoHFW. These are Fifteenth Finance Commission (FC) grants of Rs. 13,192 crore to Health and Rs. 36,022 crore to Water and Sanitation. When asked why the FC grant, which is a direct transfer to state added under health and wellbeing expenditure for the upcoming Financial Year but not in the outlay for the ongoing and previous years, the Finance Ministry said,

The FC Grants are expenditures from the Consolidated Fund of India and are in the nature of local bodies grants. These grants have been tied to specific interventions related to health infrastructure and has therefore been included. The Commission had not recommended health grants for FY 2020-21.

The Department of Health Research has been allocated Rs. 2,663 crore which is about 34.4 per cent less than the Revised Estimate for 2020-21. The experts say reducing money for health research is not a positive sign especially when more money is required now than earlier considering the ongoing pandemic and the fact that the World Health Organisation (WHO) has warned that such pandemics can be frequent in the coming future. Mr. Duggal said,

2021-22 health budget has betrayed the expectations of people that the pandemic would push the government to make structural reforms in the public healthcare system and quickly set the path for the health budget to move closer towards the goal of 2.5 per cent of the Gross Domestic Product. Let us now wait and see what states have to offer when they present their budgets.

The budget allocated for Ministry of AYUSH has seen an increment of about 28 per cent which, according to Avani Kapur, Director, Accountability Initiative and a Fellow at the Centre for Policy Research (CPR), highlights the government’s inclination towards alternate medicine.

Also Read: Budget 2021: Experts’ View On Mission POSHAN 2.0 Announced By Finance Minister Nirmala Sitharaman To Improve Nutritional Outcomes

The allocation of Rs. 2,700 crore for POSHAN (Prime Minister’s Overarching Scheme for Holistic Nourishment) Abhiyaan for the year 2021-22 has also been added in the “health and wellbeing expenditure”. The budget for POSHAN Abhiyaan was Rs.3,700 crore in the BE of 2020-21 which declined to a mere Rs. 600 crore in the Revised Estimates for the same year. This, according to Ms. Kapur shows that that the government could not succeed in implementing the programmes and schemes completely and thus could not fulfil the allocated expenditure. POSHAN Abhiyaan aims to holistically address the prevalence of malnutrition in the country through the use of technology by monitoring the real-time growth of children and tracking nutrition among women, the convergence of different sectors for better service delivery, intensifying health and nutrition services for the first 1000 days, behavioural change, training, and capacity building for making nutrition a ‘Jan Andolan’ (People’s movement).

POSHAN Abhiyaan has been restructured from Financial Year 2021-22 onwards and combined with three schemes under the Umbrella ICDS (Integrated Child Development Services) to form Saksham Anganwadi and POSHAN 2.0. For the new composite scheme, the government has allocated a budget of Rs. 20,105 crore. So why did the government not add the entire nutrition budget and chose to take just a small chunk of Rs, 2,700 in the health and wellbeing expenditure, asked Ms. Kapur. When NDTV reached out to the government with this query, the Ministry of Finance said,

Only this amount has been included since the scheme is focused on reducing the level of stunting, under-nutrition, anaemia and low birth weight in children. The scheme holistically addresses malnutrition among children and hence focuses on improving immunity among children and vulnerability to diseases.

Comparing the budget estimate in 2020-21 for the schemes constituting the restructured scheme shows that there has been, in fact, a drop in the budget for nutrition. While the allocation for Saksham Anganwadi and POSHAN 2.0 is Rs. 20,105 crore, it is almost 18 per cent less than the total BE 2020-21 of Rs. 24,557 core for four schemes which include– Anganwadi Services (erstwhile core ICDS) which got the allocation of Rs. 20,532 crore, POSHAN Abhiyaan with Rs. 3,700 crore, Scheme for Adolescent Girls with Rs, 250 and National Creche Scheme with Rs. 75 crore.

Union Budget 2021 Explained: Decoding The 137 Per Cent Increase In Health Expenditure
There has been some increase in the budget for nutrition when compared to the Revised Estimate of 2020-21

Since the government is considering POSHAN Abhiyaan as a component of health and wellbeing, one may wonder why it chose to exclude Mid-Day Meal (MDMs) programme (under Department of School Education and Literacy) that is considered as the world’s largest school meal programme. According to experts, for many children, MDM acts as the only source of a meal and nutrition in a day. In response, the Ministry of Finance asserted,

MDM was excluded on a conservative basis. The primary objective of MDM Scheme is to incentivise children to attend schools. The effect on nutrition is a positive externality, not as much as the prime reason for the expenditure under the scheme.

Also Read: Budget 2021: Swachh Bharat Mission 2.0 Will Focus On Faecal Sludge Management, Says Finance Minister Nirmala Sitharaman

According to the Union Finance Ministry, the rubric of health and well-being also includes allocations for the Department of Drinking Water and Sanitation which is Rs. 60,030 crore, a 252 per cent increase from the 2020-21 revised estimate of Rs. 17,023 crore. Out of the total budget for Department of Drinking Water and Sanitation, a majority amount of Rs. 50,000 crore is earmarked for Central Road and Infrastructure Fund (CRIF) under the Jal Jeevan Mission also called the National Rural Drinking Water Mission which aims to provide functional household tap connection to every rural household by 2024. This allocation has increased by Rs. 39,000 crore from 2020-21 RE of Rs. 11,000 crore.

In her speech, the FM had announced another scheme for increasing the access to drinking water- Jal Jeevan Urban Mission with an outlay of over Rs. 2.8 lakh crore spread over five years but as of now, no allocation has been made for it in Budget 2021.

Explaining the reason behind including the entire budget of the Department of Drinking Water and Sanitation but not the tap water connections made under AMRUT (Atal Mission For Rejuvenation And Urban Transformation) in the urban areas, an official from the Ministry of Finance said,

The aspect of clean drinking water is important even in urban areas. However, in urban areas, the scheme focuses on improving access. Making tap water available to all households and so on. The externalities on account of clean drinking water and sanitation in rural areas are of a higher order in magnitude. Drinking water and sanitation facilities were few and far between in rural areas. Department of Drinking Water and Sanitation aims at providing these facilities. WHO says that safe drinking water, sanitation and hygiene (WASH) are crucial to human health and wellbeing. Safe and sufficient WASH plays a key role in preventing numerous NTDs (Neglected Tropical Diseases) such as trachoma, soil-transmitted helminths and schistosomiasis. Diarrhoeal deaths as a result of inadequate WASH were reduced by half during 1990–2015, with the significant progress on water and sanitation provision playing a key role.

Acknowledging the increase in budget for health, Dr Deepak Aggrawal, Professor at AIIMS, New Delhi (Department of Neurosurgery, Neurosciences and Gamma Knife Centre) said,

After witnessing a health pandemic like never before, Union Budget 2021 -2022 had to be the most crucial one in terms of monetary allocations to the healthcare sector. We applaud the government’s approach of focusing on health and innovations which will play a key role in paving the way for advancements in seamless delivery of preventive healthcare.

Dr Aviral Roy, Consultant Critical Care, Medica Superspecialty Hospital in Kolkata, however, expressed concerns regarding the lack of adequate allocation for strengthening primary healthcare in the country. He said,

When it comes to executing primary health services, it is the responsibility of MoHFW but only a marginal increase can be seen for it. There are still a lot of vacancies in the health sector and the country is grappling with the insufficient human resource in medicine. I was hoping that after the health emergency such as COVID-19 that the country is facing, the budget would allocate more money towards health.

Dr Sarit Rout, Additional Professor, Indian Institute of Public Health, Public Health Foundation of India also thinks that the budget allocation for public health services and infrastructure is not adequate. He said,

The finance minister presented the 2021-22 budget in the middle of an economic downturn caused by COVID-19 pandemic. Health sector though demanded a quantum jump in expenditure to reconstruct the public health system, total allocations is Rs. 76,901 crore, around 11 per cent more than the 2020-21 BE. This is just 2.20 per cent of total government expenditure which has not changed compared to last year’s share. This amount may not be adequate to reconstruct public health systems of India. However, Rs. 35,000 crore for COVID vaccines looks good as it can vaccinate around 70 crore population. Further, emphasis on social determinants of health through higher allocation to -drinking water and, sanitation may produce better health status of the people.

Also Read: Union Budget 2021 Highlights: Key Announcements Made By FM Nirmala Sitharaman For A Swachh And Swasth India

NDTV – Dettol Banega Swasth India campaign is an extension of the five-year-old Banega Swachh India initiative helmed by Campaign Ambassador Amitabh Bachchan. It aims to spread awareness about critical health issues facing the country. In wake of the current COVID-19 pandemic, the need for WASH (WaterSanitation and Hygiene) is reaffirmed as handwashing is one of the ways to prevent Coronavirus infection and other diseases. The campaign highlights the importance of nutrition and healthcare for women and children to prevent maternal and child mortality, fight malnutrition, stunting, wasting, anaemia and disease prevention through vaccines. Importance of programmes like Public Distribution System (PDS), Mid-day Meal Scheme, POSHAN Abhiyan and the role of Aganwadis and ASHA workers are also covered. Only a Swachh or clean India where toilets are used and open defecation free (ODF) status achieved as part of the Swachh Bharat Abhiyan launched by Prime Minister Narendra Modi in 2014, can eradicate diseases like diahorrea and become a Swasth or healthy India. The campaign will continue to cover issues like air pollutionwaste managementplastic banmanual scavenging and sanitation workers and menstrual hygiene


Coronavirus has spread to 193 countries. The total confirmed cases worldwide are 17,66,30,634 and 38,22,022 have died; 5,80,25,717 are active cases and 11,47,82,895 have recovered as on June 16, 2021 at 3:30 am.


2,96,33,105 62,224Cases
2,83,88,100 1,07,628Recovered
3,79,573 2,542Deaths
In India, there are 2,96,33,105 confirmed cases including 3,79,573 deaths. The number of active cases is 8,65,432 and 2,83,88,100 have recovered as on June 16, 2021 at 2:30 am.

State Details

State Cases Active Recovered Deaths

59,24,773 7,652

1,41,440 8,982

56,69,179 15,176

1,14,154 1,458


27,77,010 5,041

1,62,303 9,859

25,81,559 14,785

33,148 115


27,48,204 12,246

1,12,792 1,456

26,23,904 13,536

11,508 166

Tamil Nadu

23,78,298 11,805

1,25,215 11,669

22,23,015 23,207

30,068 267

Andhra Pradesh

18,20,134 5,741

75,134 4,879

17,32,948 10,567

12,052 53

Uttar Pradesh

17,03,207 270

7,221 890

16,74,072 1,104

21,914 56

West Bengal

14,68,044 3,268

20,046 1,125

14,30,949 2,068

17,049 75


14,31,498 228

3,078 148

14,03,569 364

24,851 12


9,88,172 609

11,717 943

9,63,113 1,544

13,342 8


9,50,133 172

5,619 848

9,35,658 1,006

8,856 14


8,59,526 3,405

44,358 3,436

8,11,780 6,799

3,388 42


8,21,078 352

8,884 658

8,02,187 1,006

10,007 4

Madhya Pradesh

7,88,649 224

3,610 331

7,76,424 528

8,615 27


7,66,357 228

3,703 374

7,53,584 564

9,070 38


7,17,949 410

4,360 412

7,04,075 813

9,514 9


6,06,436 1,556

19,933 528

5,82,993 2,070

3,510 14


5,89,153 628

10,802 1,111

5,62,701 1,691

15,650 48


4,66,590 3,415

41,184 475

4,21,378 2,906

4,028 34


3,43,793 184

2,646 416

3,36,058 596

5,089 4


3,37,449 274

3,642 266

3,26,822 515

6,985 25

Jammu And Kashmir

3,08,726 715

12,407 1,125

2,92,114 1,830

4,205 10

Himachal Pradesh

1,99,197 321

4,050 382

1,91,737 691

3,410 12


1,63,048 327

4,175 231

1,55,926 548

2,947 10


1,13,192 355

4,668 279

1,06,828 629

1,696 5


61,200 40

486 21

59,917 58

797 3


61,096 785

8,744 301

51,354 476

998 8


60,385 536

4,886 65

54,870 596

629 5


42,759 450

4,430 99

37,579 542

750 7

Arunachal Pradesh

31,938 290

2,849 40

28,934 326

155 4


23,854 101

2,972 229

20,423 327

459 3


19,649 38

552 20

18,898 57

199 1


18,659 209

3,239 67

15,136 273

284 3


15,899 268

3,637 45

12,191 312

71 1

Dadra And Nagar Haveli

10,473 9

61 2

10,408 7



9,297 61

484 36

8,768 96

45 1

Andaman And Nicobar Islands

7,280 11

105 4

7,049 15


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