Expert Views

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The much needed ACCHE DIN effect is beginning to show. - Dr. Naresh Trehan's reaction to Budget 2016

Dr. Naresh Trehan

"The budget in my view was very thought through and well pointed towards the social sector. It brings great relief to farmers and people who are marginalised. The social scheme & the infrastructure movement forward to create jobs, so I think from that point of view at the base level it has done a lot, for the real ground realty people.

As far as health is concerned, it's a great move forward to insure every family for one lakh, which imminently gives them the security that they can access healthcare that was the idea how to create universal access. For elderly, its 1.30 lakh which is even better. Also along with that, the announcement of PPP board there will be many dialysis centres established closer to the villages, that will help a lot because that has been a big problem for people to travel across to require dialysis twice or thrice a week and to travel long distance is devastating for family and the patient, so that's a good sensitive move and the third thing is providing 3000 fare price to medical shops also very good thing.

Overall I think, health sector has got what was much needed in terms of the people who were under the burden of healthcare will get relief which was surely needed and what we were pushing for the last couple of years. So overall, its real thumbs up to the budget and I am happy and proud that they have done this way. The much needed ACCHE DIN effect is beginning to show."

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Higher Govt. Spending & New Health Protection Scheme should Boost Universal Healthcare: NATHEALTH

Mr.Anjan Bose

"Higher Govt. Spending & New Health Protection Scheme should Boost Universal Healthcare: NATHEALTH NATHEALTH Welcomes announcement of New Health Insurance Scheme". Read more...

Union Budget 2016-17 has given due attention to the social sectors including health. Higher allocation & spending should boost universal healthcare. Speaking on the Union Budget announcements, Mr. Anjan Bose, Secretary General, NATHEALTH said, 15% increase in government spending on the social sectors with focus on healthcare should go a long way in ensuring universal health coverage. It is promising to note that the Government intends to provide health insurance coverage to under privileged class through the new Health Protection Scheme of Rs. One Lakh to cover unforeseen illness in poor families. This should also act as a catalyst for investment in healthcare sector and help in improving affordability and accessibility of quality healthcare. This is all the more important considering that nearly 75% of India population is currently without any health insurance.

However Mr Bose also added that the implementation process for such a large project has to be very efficient and he sees potential opportunity for PPP in this area. Mr Bose felt that government's announcement of opening 3000 stores under Prime Minister's Jan Aushadhi Scheme is also good news towards affordable healthcare for the masses.

Further, announcement of National Dialysis Service programme is yet another welcome measure for the health sector. The industry could have a major role to play in this as the programme would be carried out in PPP mode in district hospitals. Exemption of custom duty on dialysis equipment would further support this commendable programme. However, the health care industry is concerned since the Government has not addressed the issue of recent increase in import duty on medical equipment and devices. The medical technology sector is in an infancy stage with manufacturing limited to less complex devices. More than 75% of medical equipment / devices is still imported and hence the duty increase will result in increase in healthcare cost. Healthcare sector was also looking forward to positive response from the government to its recommendations of Exempting of Healthcare Services from GST, Increase of tax holiday for establishing healthcare facilities from the current period of five to ten years in non-metros, Increase in Tax Exemption on Preventive Health checkup and setting up of a healthcare infrastructure fund as well as a medical innovation fund.

NATHEALTH requests the Government to consider these recommendations for the benefit of the healthcare sector and the citizens of the country.

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Reactions to Union Budget 2016

Dr. Naveen Nishchal

I am really happy with the budget because its really good for healthcare sector, few points are worth mentioning here.

1. Insurance Scheme of Poor people covering expanses upto 1.3 lacs will not only benefit the needy but also boost the business of healthcare providers working in tier two cities.

2. Opening Dialysis centres is also a welcome sign

3. Generic medicines stores will also cater the needs of poor and help in reducing the burden of a common man.

This Budget has a flip side also, that is, how Govt. will run dialysis centres when we are struggling for skilled manpower like dialysis technicians, also there are very less facilities in tier 2 and tier 3 cities which can provide a holistic care to the needy and an insurance holder.

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Reactions to Union Budget 2016

Dr.Shuchin Bajaj

"I feel that the Finance Minister has presented a very well thought out and balanced budget. We all know that the global economic scenario is getting darker and the winds are blowing against us. In this precarious situation, the Minister has done well to keep the fiscal deficit under a tight check and to focus on infrastructure. The focus on the agrarian society is also very welcome as I strongly feel that we need to pull up the rural population and that the trickle down effect is not a sustainable solution

On the health front, I feel that there are several positives to look to. The Universal Health Insurance of Rs. One Lakh and a top up of an extra Rs. Thirty thousand is a very good step as currently more than thirty million people are pushed below the poverty line every year just because of healthcare costs. This insurance will go a long way in preventing the unfortunate incidents.

The opening of 3000 Jan Aushadhalaya stores is also a welcome step and will reduce the costs of lifesaving drugs significantly. The drugs and consumables account for more than 70% of the out of pocket expenses of the community and cause a lot of distress to the community.

The National Dialysis Scheme is also a very good concept as the chronically ill patients spend huge amounts on getting repetitive healthcare access. The increase in prices of cigarettes, diesel cars and the provision of LPG to rural households will also cause many beneficial effects to the health of the community.

Some gripes still remain though, with beedis still not being taxed. Also there has not been any emphasis on incentivising doctors to serve in the semi urban and rural areas. There has also not been any stress on solving the manpower issues in healthcare with extreme shortage of doctors and nurses hampering our efforts in providing universal health coverage. There should also be incentives to the healthcare devices manufacturers to produce locally instead of depending on imports to further the make in India dream.

I feel that till the time Healthcare becomes an electoral issue, the government will not have any pressure to include it in the core focus areas. It is sad to see that it has not got mention in the none core pillars that the government is currently focussing on."

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Budget Reaction - Mr Rajiv Nath, Forum Coordinator, AIMED
Focus on enhanced healthcare facility for rural population and medical insurance for senior citizens is laudable, but would have been happier if some concrete steps to bring down overall healthcare cost were announced – Rajiv Nath, Forum, Coordinator, AIMED, New Delhi

Mr Rajiv Nath

Finance Minister Shir Arun Jaitley must be applauded for bringing budget's focus on rural community as well as senior citizens. Budget's proposal to set up 3,000 medicine shops in rural areas and insurance scheme for senior citizens is noteworthy and noble intent of low cost access to dialysis centres.

But then, given India's humungous population with majority of people with modest income, the biggest challenge that our country focuses is to ensure low cost quality healthcare access to majority of Indians. Government needs to realize that medicines are just one component of healthcare cost and at times not the major component of healthcare cost also. Medical devices are equally if not more as critical a part of overall healthcare cost as medicines and diagnostics. If the government had focused on giving a major boost to medical device manufacturing in the country and also ensured a robust MRP regime, then it would have served two purpose with one shot – i.e. (a) Lower the overall healthcare cost and better price stability and (b) lead to sharp reduction on import dependency.

The additional critical benefit would have been quality job creation within the country.

Anyway, we are still awaiting the fine print and we are just hoping that some of our pre-budget recommendations have been incorporated.

These include:
(a) Withdrawal of Concessional Duty Notification of Basic Duty and Special Additional Duty of Medical Devices and for reverting of Duty on the items covered under HS 90.27, 30.06 and 38.22

(b) Imposition of 10% Basic Duty on HS 90.27 & HS 30.06 (mainly Diagnostics - equipment & reagents )

(C) reduction of duty on raw materials to produce these devices and diagnostics to 2.5% . This is in line with recent announcement done for some medical devices on 19 January .

In addition, we also need to think of consumers and dept should consider to introduce an Tax Innovation Structure of stalling Artificial Inflation of MRP by imposing a 2% CVD on MRP based criteria with Abatement of at least 50% (in case 1% Excise Duty on MRP is not possible) to have a disincentive to Importers from passing on above increase to the Consumers. This will make Indian Medical Devices including Diagnostics competitive and safeguard consumers from exploitation.

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Post Budget reactions by Ms. Ameera Shah, MD & CEO- Metropolis Healthcare.

Ms. Ameera Shah

"Overall a promising budget. Its heartening to see the fiscal discipline and a slew of initiatives for the under privileged. A lot of emphasis on infrastructure has set the right tone for overall economic reform. When it comes to healthcare, the union budget has rightly addressed the issue of unexpected healthcare expenses being a burden and pushing families in to poverty. The Health Protection Scheme and the Rs. 1 Lakh cover will surely help the families in need. However the budget has once again failed to address any kind of healthcare reform. It is important that the leaders from this industry are heard in the policy process where they can join hands with the Government to spearhead more planned and regulated funds for health and healthcare. This by far has been the most disappointing budget for health. It is time that the government realizes that Health is an important indicator of economic development and work towards an overarching vision for healthcare."

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Reactions to Union Budget 2016
A. Vellayan, Executive Chairman, Murugappa Group

Mr. A Vellayan

The Finance Minister has attempted to present a Budget that will give impetus to the agriculture sector, while maintaining fiscal discipline.

The Budget initiatives address the needs of the Agriculture & Rural sectors:

The emphasis given to Irrigation, Soil Health, increased use of organic fertilisers and developing a Unified Agriculture Marketing e-platform are steps in the right direction. The reduced excise duty on micronutrients will help its wider application. The creation of the dedicated Irrigation Fund with an initial corpus of Rs. 20,000 crores will help to increase the overall area under irrigation over the long term. The increased allocation to MGNREGA & the announcement of Rs. 5500 Crores under PM Fasal Bima Yojna are welcome moves. The Government is also piloting the Direct Benefit Transfer for Fertiliser to curb leakage. However, the much-anticipated demand of increasing urea prices to help in balanced nutrient use has been given a slip

The Price stabilization fund created earlier for Sugar, has been now extended to Pulses. We look forward to a similar support in the coming years for other critical crops as well. The Finance Minister has also ensured fund availability for these schemes, through the Krishi Kalyan Cess.

In the Financial Services sector, we welcome the announcement allowing tax deduction in respect of provisioning of bad & doubtful debts. We hope that the amendment of the SARFAESI Act and the Bankruptcy code will strengthen the Financial Services industry. We look forward to the notification of SARFAESI Act on Housing Finance, announced in the last year's Budget, to be expedited.

There is continued focus on financial inclusion by the announcement of ATMs & Micro ATMs in post offices. The Government's plan to list Public Sector General Insurance companies in Stock Exchanges will help strengthen the General Insurance Sector.

The announcements for settlement of pending taxation matters will help resolve long overdue cases, and the simplified process of declaration of undisclosed income is likely to bring in new tax payers.

From an infrastructure perspective, the increased focus on construction of roads and highways, creating an enabling ecosystem for Public-Private partnerships for projects and easing the passenger traffic system by creating avenues for more operators, will have a positive cascading effect in the overall economy.

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Poonam Muttreja, Executive Director, Population Foundation of India

Poonam Muttreja

Many of the announcements in the health budget are very welcome. The allocation for health in this budget has been increased by 22% over the previous year's budget estimate to Rs. 39,533 crores. This is a very significant move given that last year, the allocations for health were substantially reduced. More specifically, the budget for family welfare budget (which includes family planning) has been increased by 67% over previous years. Though details of eligibility are not yet known, the announcement in the budget to finance a health insurance scheme that offers financial protection of Rs 1 lakh per family is a good move. It is bound to save millions of Indians from slipping into penury due to catastrophic illnesses. The provision of 3,000 new generic drug stores is also likely to ease the availability and affordability of medicines for the poor. These are important steps towards the eventual realization of universal health coverage

However, despite the increase in budgetary allocations this year, the under-funding of health by government remains a concern. The relative importance to health in the budget remains the same. The share of Family Welfare has increased only marginally from 4% last year to 5% of the health budget this year. The 2016-17 health and family welfare budget estimate for 2016-17 is 3.7% of the total central government budget (net of transfers to states and UTs) which is similar to last year's proportion. These increases are insufficient to offset the 54% decline in allocations by the central government to family welfare between 2013-14 and 2015-16. Much higher health allocations are necessary to carry forward the family planning agenda and reorient it towards reproductive health and rights, paying greater attention to quality and spacing methods.

This year's budget places emphasis on JAM (Jan-Dhan, ADHAR, and Mobile) as a means to ensure that social security benefits and direct cash transfers reach a large proportion of the poor. The budget's emphasis on social determinants of healthcare like sanitation and cleanliness is appreciated. However, special attention should be paid to issues of access as well as needs of the underprivileged population groups like dalits, tribals, homeless urban poor and the minorities. Similarly, changing behaviour is critical for many of the health-seeking and hygiene practices to change for the better. Unless given special attention to changing mind-sets, it could take decades to achieve better health outcomes. In the meantime, the government should give top priority to preventive and curative care at the primary level in order to speedily improve the health status of the population. A healthy workforce is a prerequisite for India to achieve many of the ambitious goals set by the NDA government to transform the nation.

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Quote by Association of Hospital (AOH) on Union Budget 2016 with reference to healthcare sector

"Out of the nine pillars of Union Budget one was social healthcare. The major highlight in healthcare sector was the introduction of National Dialysis Programme. Also, the government has announced an exemption on basic dialysis equipment from custom duty, which is in line with AOH's recommendation. However, the government should also consider exemption of custom duty on critical medical equipments. Another important announcement provided for the opening of new medical stores with better quality and affordable medicines for common man

This proposal will help to reduce the overall healthcare expenditure for the public in general. However, the quality of the medicines should be ensured. The newly introduced health protection scheme will provide health cover up to INR one lakh per family. For senior citizens an additional top-up package of up to INR 30,000 will be provided. This particular healthcare insurance announcement is a welcome proposal.

In comparison to previous years, the 2016 Union budget seemed to lack lustre in terms of the health care sector. Health care being one of the major concerns in the country, a lesser amount of focus was given to the development of this sector."

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Post Budget Reaction from Mr Raman Mehta, Founder Alchem International- Leader in the field of phytoceuticals

Mr Raman Mehta

"The needs of the pharmaceuticals and Ayurveda industry did not get much attention in the Budget. No clear cut incentive has been provided for promoting the manufacture of plant-based medicines in India using modern plants and technology, even though there are sops for the farming community and food processing industry. The government was expected to introduce several industry-friendly policies and incentives to provide a major push to the growth of the Indian bulk drug industry for it to be a formidable force globally. However, no major tax reforms (especially on the indirect tax front) have been announced by the Government. A good thing in the budget is the announcement of a special patent regime with 10% rate of tax on income from worldwide exploitation of patents developed and registered in India. This will promote drug discovery in the private sector, especially in the Ayurvedic and phytomedicine segment which is expected to grow by leaps and bounds in the coming years."

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Shri S Ramadorai, Chairman, National Skill Development Agency (NSDA) and National Skill Development Corporation (NSDC)

Shri S Ramadorai

"Budget 2016-17 seems promising for India's youth - whether it is about quality of education, focus on skill development, improving teaching and research outcomes, emphasis on job creation or creating an ease of business to promote entrepreneurship. It is good that the Public Private Partnership model has worked reasonably well for the skills ecosystem which needs to be given more encouragement.

The setting up of 1500 Multi Skill Training Institutes (MSTIs) is a great PPP initiative that will give major boost to skill development while the National Skill Assessment & Certification Board with both government and industry representation, will be instrumental in ensuring quality assessment of the skilled workforce that gets trained.

The continuity in tax benefits available under section 35CCD to training institutes till 2020 is also encouraging to the skill ecosystem."

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Mr. Mahesh M, CEO, ISHANYA & Housl!fe

Mr. Mahesh M

"Budget 2016 appears to be in the right direction, as we step into tougher times, courtesy the global scene. A stronger focus on Infrastructure development combined with adequate thrust on skill development will hopefully result in better productivity by us as a nation. Retail Trade as the largest service sector employer needs a continuous pool of employable talent and if this can be achieved by the measures laid out in the Budget through the Skill development Board, assisted by corporate, then we will be able to see a virtuous cycle of increased retail leading to improved consumption resulting in the societal transformation through better quality of life and lifestyles for one and all.

Trust that the ease of doing business as articulated in the budget will encourage industry to raise their involvement levels and expand their horizons, geographically and otherwise. This will enable a more impactful contribution to the Economy. Let us hope that "implification ‘becomes a key word in the process, encouraging various sectors to open up at a rapid pace.

Overall,the budget appears quite purposeful with a determined focus on key sectors and drivers of the Economy. Hopefully optimistic that the reforms stated take place in the same manner for the desired results."

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Mr. Anil V. Pillai, Director, Terragni Consulting

Mr. Anil V. Pillai

"The PM is a strong believer of two things, operational efficiency leads to lasting change and the backbone of the nation's growth will come from Rural economy and the MSME/entrepreneurial sector. The FM and the budget reflects both themes strongly.

Thus the points that stand out in the budget:
a) Impetus to the rural and the small: This is an extremely welcome move. Social, infrastructural spending to spur rural demand and focus on farms,cold chains and the chipping away at the APMC monopoly are all in the right direction, this and DBT for fertilizer have the potential to be game changers for farmers. Similarly the focus on small business credit and ease of business will only boost MSME growth. This coupled with Startup India will unleash frenetic entrepreneur led activity and employment is what the Government is banking on.The exemption of capital gains from startups if invested in approved funds is a good step and one that could find many takers.

b) Ease of doing business: The budget goes some distance in setting the foundations for a smoother People-Government interface. Single window , same day clearances for setting up business, cleaner interfaces with the IT department and a clear commitment against retrospective tax are very welcome and a step in the positive direction.

c)100% FDI in processed foods, amending the Motor Vehicle Act to allow private operators. Huge investment outlays in Ports+Roads+Rail are aimed to spur domestic demand as well as create infrastructure that contributes to real GDP growth. The other huge +ve in this budget is sticking to the fiscal deficit target, this will lead to a virtuous cycle of increased FDI-lower inflation-growth

What the Government could have done better:
1. Go further down the reforms agenda, especially on disinvestment. We need a time bound program for government to get out of business. This was not addressed.

2. Direct taxation reform: Today direct taxes are skewed with very little addition to the basket. This needs to be addressed.

3. FDI in retail: Having 100 % FDI in processed food and not in retail is a bit at odds. The Government will need to address this soon.

4.Punitive damages from defaulters to banks. Given that our banks are stressed, surprised that this was not addressed by the Fin Min"

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Mr. Farrokh N. Cooper, Chairman & Managing Director, Cooper Corporation Pvt. Ltd.

Mr. Farrokh N. Cooper

"During the earlier BJP regime there has been roll backs on many bold decision taken by then Finance Minister on political grounds. However now with Mr. Arun Jaitley presenting a positive budget I am sure there will be no roll backs because it is the wish of the people and the need of the hour for India move ahead not roll back.

The budget is pro-rural, pro-farmer, pro-common man. They have rightly seen the need to increase the income of the people who virtually live on grass roots and are the grass roots of the country. This in itself will generate tremendous GDP. We congratulate Mr. Arun Jaitley for his vision and we are sure that in the history of India his budget will be seen as a landmark.

We acknowledge the concessions he has given for the export sector and simplification of tax administration and litigation. The Finance Minister has gone into great details in the agriculture sector when he has acknowledged the importance of honey in the economy and it is our wish that the sweetness and flavour of honey permeates throughout the economy.

Also as quoted in bible "let there be light" Mr. Jaitley has promised light to all the villages throughout India in a defined timeline manner. It is a welcome progressive move to give warmth to the rural people."

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Post Budget Reaction from Varun Khanna, Managing Director- BD (Becton, Dickinson & Co) India - a leading medical technology company

Mr. Varun Khanna

The union budget exudes optimism and provides some encouraging measures to help India towards rural development, infrastructure, tax reforms, and structural transformation. The 9-pillar agenda was fairly strategic and is reflective of the Government's intent of a long term programmatic approach. Inclusion of health insurance for elderly indicates the progressive nature of the budget. It will be good to see larger ambit of population benefiting from such steps that will ultimately bring down costs of healthcare in the country.

The budget looks fairly positive for the healthcare sector. An impetus to higher public healthcare spending would have made it more favorable.

It is encouraging to see the reduction in import duty on certain dialysis equipment but the budget could have been broad based by extending import duty exemption on devices across a broader spectrum. This calls for greater representation of the medical devices sector and benefits extended to diseases with high burden in India such as hepatitis, cervical cancer, diabetes, tuberculosis and cardiac problems.

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From Shri Rajiv Pratap Rudy, MoS for Skill Development and Entrepreneurship (Independent Charge) and Parliamentary Affairs

Shri Rajiv Pratap Rudy

"The budget for skill development is highly encouraging for us. As announced, we will be creating 1500 Multi Skill Training Institutes (MSTIs) which will basically be the new generation ITIs set up in PPP mode. So far we have just had standalone government or private ITIs. These will be set up in those blocks and districts of the country which are yet to focus on skill development.

We are also certain and committed to achieve our target of skilling 1 crore youth over the next 3 years under the Pradhan Mantri Kaushal Vikas Yojana (PMKVY). In line with this, we are already setting up model skill centres across more than 500 districts in the country.

The formation of the National Skill Certification Board is another big step in further strengthening the skill ecosystem. It will see representation from both government and industry, which will collectively enable a joint framework for quality skill assessment.

The focus of the budget on creation of jobs and entrepreneurship opportunities through initiatives like Start-Up India and others, spells out the clear vision of government, to link the skilled workforce with employment opportunities."

We will work to deliver Entrepreneurship, Education and training in 2200 colleges, 300 schools, 500 government ITIs and 50 Vocational Training Centres. Aspiring entrepreneurs will be connected to mentors and credit markets."