How are health budgets allocated and dispersed, across program areas? | India How are health budgets allocated and dispersed, across program areas? | India

06 Jul 2022

The Ministry of Health and Family Welfare (MoHFW) oversees two departments: the Department of Health and Family Welfare and the Department of Health Research. When the Union Budget has been presented to Parliament, the Standing Committees of the Parliament scrutinise each Ministry’s Demand for Grants in detail. This document lays out the various priorities of the government in the form of estimated expenditures under various line items or programme areas. The MoHFW also presents its Demand for Grants for scrutiny to the Standing Committee. For example, the observations and recommendations of the Committee when scrutinising the 2018-19 Demands for Grants was that the government health expenditure (at 1.35% of GDP) (NHSRC, 2021) may not meet the goals of the National Health Policy that envisages a health expenditure of 2.5% of GDP by central and state governments by 2025. The feedback also mentioned that attention is needed to be paid to the wide gap between demands of the Department and allocation made as well as delays in transfer of funds and scaling down on various health initiatives and programmes due to the reduced budgetary allocation (Kala, Mann, & Tiwari, 2019).

When the Demands for Grants are passed, they are then consolidated into an Appropriation Bill and then subsequently the Finance bill is also taken up for consolidation. A similar process takes place at the State/UT level, where state legislative assemblies and state departments of health are responsible for preparing the estimates for different budget heads under the departments’ Demand for Grants.


Kala, M., Mann, G., & Tiwari, S. (2019). OVERSEEING PUBLIC FUNDS.

National Health System Resource Centre (NHSRC). (2021). National Health Accounts-Estimates for India: 2017-2018. Ministry of Health and Family Welfare, Government of India. Available from: https://nhsrcindia.org/sites/default/files/2021-11/National%20Health%20Accounts-%202017-18.pdf