Union Budget 2020: Key Highlights for Pharma & Healthcare
In the Union Budget released on 1st Feb 2020, the finance minister laid special emphasis on reforming the hospital and healthcare centers by expanding the existing policies and introducing new policies. Here are the key highlights of Pharma & Healthcare Budget 2020 –
• To expand the government’s flagship health insurance scheme Ayushman Bharat-Pradhan Mantri Jan Aarogya Yojana (PMJAY).
• A budget of Rs. 69,000 crore has been allotted for the healthcare sector. Of this, nearly Rs. 6,400 crore would be for the AB-PMJAY scheme. This year’s budget was a nearly 10% increase from the last year’s allocation which was Rs. 62,659.12 crore.
• 5% health cess to be imposed on the imports of medical devices, except those exempt from BCD (Basic Custom Duty) in an effort to encourage the manufacturing of medical devices in India. The customs duty which was 7.5%, plus educational cess, will now be 12.5% plus the educational cess.
• Social welfare surcharge of 10% to be levied on the import of certain medical equipment.
• The AB-PMJAY scheme is expected to expand by setting up more hospitals in the tier-II and III cities. This expansion would come under the public-private-partnership (PPP) model. The government will provide a viability gap funding for the process. The proceeds obtained from taxes on medical devices would be used for the development of hospitals. At present, around 16,000 hospitals are enlisted under the scheme of which around 50% are private sector hospitals.
• Under Ayushman Bharat, the health ministry has also come forward with a program to set up 1,50,000 health and wellness centers (HWCs) by the year 2022.
• To expand Jan Aushadhi Kendra Scheme to all districts offering 2000 medicines and 300 surgical instruments by 2024. As of June 2019, there were 5,300 Jan Aushadhi Kendras, offering about 900 drugs and 154 surgicals and consumables.
• To expand the government’s vaccination program – Mission Indradhanush to cover 12 more diseases, including five new vaccines by 2025.
• To eliminating tuberculosis from India by 2025 with the motto “TB Harega- Desh Bachega”.
• EXIM Bank together with SIDBI to allocate Rs. 1,000-crore for technology upgradations, R&D, business strategy to pharma sector, among others. This will provide encouragement to mid-size pharma companies in increasing exports.
• Special bridge courses to be designed by the Ministries of Health, and Skill Development in order to fulfill the demand for teachers, nurses, para-medical staff and care-givers abroad.