Budget 2020: Govt to use proceeds from taxing medical devices for setting up hospitals in tier 2 and 3 cities

Finance minister Nirmala Sitharaman allocated Rs 69,000 crore, inclusive of Rs 6,400 crore for Jan Arogya Yojana, to healthcare in Budget 2020. This marks an increase from last year when she allocated Rs 62,659 crore.

The Government will open hospitals in tier 2 and tier 3 cities covered under Aspirational districts scheme which still do not have a Ayushman-empanelled hospital.

FM Sitharaman also announced that proceeds from taxes on medical devices will be used for this vital health infrastructure in these districts.

She also announced a new campaign to eradicate TB. Provided Rs 69,000 crore for health inclusive of Rs 6,400 crore for Jan Arogya Yojana

This is in line with what heathcare experts have asked for in terms of increased allocation to the sector. The government has aimed at spending target of 2.5 per cent of GDP till 2025.

India still struggles with high out of pocket expenditure on healthcare as insurance coverage remains poor.