As mentioned above, the health budgets are a total of central budget and state budgets. Most of the programmes visualised in the central budget for health get to be implemented by the states/Union Territories (UTs). A good example is the National Health Mission, which has several components: the national rural health mission, the national urban health mission, a communicable diseases programme, a non-communicable disease programme, and infrastructure maintenance are the major ones. States have the flexibility to plan and implement state specific action plans and need to draw up their respective Project Implementation Plans (PIP) (MoHFW, 2020), which spell out the key strategies, activities undertaken, budgetary requirements and key health outputs and outcomes. The funds flow from the Central Government to the states/UTs, as described above.

Previously, funds for various schemes initiated by the central government were directly transferred to the implementing agencies in states, bypassing treasuries of state governments. Since March 2014, funds are being released first to the treasuries of sub-national (State) governments, which are then responsible for transferring the funds to the implementing agencies (Choudhury, and Mohanty, 2018).

References:

Choudhury, M., & Mohanty, R. K. (2018). Utilisation, Fund Flows and Public Financial Management under the National Health Mission. New Delhi. Available from https://www.nipfp.org.in/media/medialibrary/2018/05/WP_2018_227.pdf

Ministry of Health and Family Welfare (MoHFW). (2020). Programme Implementation Plan. National Health Mission. Available from http://pip.nhm.gov.in/.