Tuesday November 12, 2019

Indian healthcare needs urgent reforms: The Lancet

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London: Indian healthcare system needs urgent reforms across several key challenges if the country is to achieve the government’s vision of assuring health for all, says a paper in The Lancet.

The paper, authored by professor Vikram Patel from London School of Hygiene & Tropical Medicine and colleagues, has documented India’s progress on major health indicators in the past decade but also its many deficiencies.

Key health indicators for Indian states

“The health time-bomb ticks on due to the rising burden of non-communicable diseases. There are widespread inequities in health outcomes that are apparent in the large morbidity and mortality differentials across socio-economic status, caste, class, sex, and geographic location,” Patel said.

The most disturbing indicator of the deficiencies of the Indian healthcare system is the observation that health care costs are driving millions into poverty.

The authors argue not only for more resources but for an integrated national healthcare system, built around a strong public primary care system with a clearly defined supportive role for the private and indigenous sectors.

The system should address acute as well as chronic health care needs and should be cashless at the point of service delivery, the authors said.

According to the paper, India continues to lag behind regional neighbours especially on health indicators like mortality rates for children aged under five years, with India recording 27 percent of all neonatal deaths and 21 percent of all child deaths in the world.

The paper calls for strengthening the country’s weak primary health system.

“Second is the challenge of skilled human resources, where an overall shortage was further compounded by inequitable distribution of skilled workers,” the paper said.

“Also, India needs to better harness and regulate its large private sector” in 2014, more than 70 percent of outpatient care and 60 percent of inpatient care was provided in the private sector.

“However, lack of regulation has led to corruption across the sector, with consequent poor quality of care and impoverishment of patients,” it added.

According to the authors, dismally low public spending on health has crippled the public sector and created large barriers in quality and access.

Gaps in the availability of health professionals in India

The total expenditure on health in India fell from 4.5 percent of gross domestic product (GDP) in 2004-05 to 4.0 percent of GDP in 2013-14.

Real expenditure and government expenditure on health per head from 2004 to 2014

With India spending as little 0.1 percent of its GDP on publicly funded drugs, close to two-thirds of the total out-of-pocket expenditure on health was incurred on drugs, often used irrationally.

Out-of-pocket expenditures on health per episode of inpatient and outpatient care in India

“Only a radical restructuring of India’s healthcare system will assure healthcare for all Indians,” Patel said.(IANS)

(Picture courtesy: www.thelancet.com)

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Wolrd Bank Chief Asks India to Undertake Financial Reforms

It has made progress in terms of monitoring of assets, the bankruptcy process and deepening of the banking system

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India, Financial, Reforms
The Indian financial sector has made quite a bit of progress. Pixabay

India must undertake financial reforms in three key areas — sound regulations for non-banking financial companies (NBFCs), allow private sector banks in a big way in the banking sector and deepen capital market to aide growth — World Bank group President David Malpass said during a media interaction on Saturday.

Malpass, who is on a three-day visit to India, earlier met Prime Minister Narendra Modi, Finance Minister Nirmala Sitharaman and members of the Niti Aayog and discussed financial sector reforms with them as well.

“We (Malpass and Modi) discussed the ways in which the financial sector can move forward. The Indian financial sector has made quite a bit of progress. It has made progress in terms of monitoring of assets, the bankruptcy process and deepening of the banking system.

“I am looking forward to encouraging progress in three primary areas — to allow growth of the banking sector, including the private sector; allow and encourage deepening of capital market bonds, mortgages; and the third is regulations for NBFCs which have grown in importance in the Indian financial system, but entails some risks.

India, Financial, Reforms
Malpass, who is on a three-day visit to India, earlier met Prime Minister Narendra Modi, Finance Minister Nirmala Sitharaman and members of the Niti Aayog and discussed financial sector reforms with them as well. Pixabay

“Having sound regulations for NBFCs, which is vital to India’s overall growth, will help India’s financial sector. Prime Minister Modi has the goal of a $5 trillion economy. That’s a powerful vision that needs to be assisted by innovations in the financial sector,” Malpass said during the media interaction.

The NBFCs have caused credit squeeze in the financial sector. Default in IL&FS bonds sparked a liquidity squeeze that spread to other NBFCs. It led to credit squeeze, over-leveraging, excessive concentration and massive mismatch between assets and liabilities. The government has since been observing the sector quite closely.

Malpass also called for more reforms to support growth.

“My prescription is that openness to reforms and innovations, and improvements in the government structures will allow for faster growth. India has undertaken important reforms in the last few years,” he noted.

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Replying to a query as to whether demonetisation has caused lower growth in India, the World Bank chief said, “Economists made lots of forecasts… They were saying India has been affected by the global environment and has slowed from the higher past growth rates and it is very much related to the slowdown in global growth.”

Recently the World Bank sharply cut India’s growth forecast for the current fiscal to 6 per cent, down from the 7.5 per cent forecast it made in April.

Malpass said the main policy challenge for the country is to address the sources of softening private consumption and the structural factors behind weak investment.

The World Bank President said that stronger courts, modern land management and land permits and enforcement of contracts will benefit India.

India, Financial, Reforms
We (Malpass and Modi) discussed the ways in which the financial sector can move forward. Pixabay

He also said that the possibility of setting up fast track courts for dispute resolution should be considered.

To modernise land management, India could digitise land records, which will facilitate quick transactions, he said.

Malpass also said that global trade uncertainty, Britain’s plans of leaving the European Union and the low investment rate in the world were among the factors affecting growth.

“I think what is to be done is to have better growth programmes country by country,” he said.

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Malpass said the World Bank will continue with the $6 billion lending target for India. Ninety-seven projects are currently being executed with loan assistance from the World Bank in India.

“The World Bank right now has 97 projects in India with a commitment of $24 billion. We expect the programmes to continue,” he said.

Praising the recent corporate tax cut, Malpass said, “India has taken a good step with the recent cut in corporate tax rate which will add to its growth.”

The government recently cut the effective corporate tax rate from 35 per cent to 25 per cent and those not availing any other incentive will have an effective tax rate of 22 per cent. (IANS)