Thursday, July 18, 2024

Amid Threat of Covid 3rd Wave, Govt Promises Rs 50k cr guarantee, Rs 23,220 cr to Ramp Up Health Infra

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To ramp the healthcare infrastructure amid the looming threat of the third wave of Covid-19 pandemic, finance minister Nirmala Sitharaman announced a host of measures on Monday. The relief packages included a Rs 1.1 lakh crore loan guarantee scheme for the affected sectors, an additional Rs 1.5 lakh crore under emergency credit guarantee scheme, additional financial support for health sector among others.

Out of the Rs 1.1 lakh crore loan guarantee scheme, an amount of Rs 50,000 crore will be reserved to scale medical infrastructure in the “underserved” areas. The central government will provide guarantee for implementing new projects related to health and medical infrastructure in areas, except eight metro cities in the country. At least 50% credit guarantee will be for the expansion and 75% for launching new projects. For building medical infrastructure in the aspirational districts, the centre will provide 75% guarantee cover for both the new projects and expansion of the new one. The maximum loan amount has been fixed at Rs 100 crore for a duration of up to three years. The interest rate has been capped at 7.95% for medical infrastructure. The National Credit Guarantee Trustee Company Limited will provide the guarantee for upcoming projects.

The central government has allocated an additional amount of Rs 23,220 crore for public health. “The new scheme will be focused on short term emergency preparedness with special emphasis on children and pediatric care/pediatric beds,” finance ministry said. It will help in “sort-term HR augmentation through medical students (interns, residents, final year) and nursing students,” the FM added. It will also help to increase the availability of ICU beds, oxygen supply at central, district and sub district level. The funding will also ensure adequate availability of equipment, medicines and access to teleconsultation, ambulance services, according to the ministry. “It will enhance testing capacity and supportive diagnostics, strengthen capacity for surveillance and genome sequencing,” the finance ministry added.

Prime Minister Narendra Modi said, “Measures announced by FM Nirmala Sitharaman today will enhance public health facilities, especially in under-served areas, boost private investment in medical infrastructure and augment critical human resources. Special focus is on strengthening healthcare facilities for our children.”

“The last year has demonstrated the dire need for an upgrade in both our private and public healthcare infrastructure and systems. The announcements providing support to the healthcare sector is therefore timely. Shortage of infrastructure in tier 2 and 3 was a gap that was starkly visible during the last year. Allocation of funds for this as well as easing availability of cheap finance for private sector investment in it are welcome steps. Specific focus on paediatric care will hopefully cater to some long term improvements in this segment,” said Charu Sehgal, partner, Deloitte India.

“It is equally important however to ensure that these funds are in fact utilised and a clear time bound investment plan is laid out. Often we have seen that budgeted allocations are not used,” Sehgal added.

“Another critical gap is the acute shortage of healthcare resources, infrastructure without staff and equipment is of limited use. It is good to see that there is a provision for some short term solutions to this issue as well,” Sehgal mentioned.

“The government intends to provide a guarantee coverage for expansion of existing projects and setting up of new projects related to health or medical infrastructure in cities other than eight metropolitan cities. This will go a long way in providing a short-term stimulus to the affected sectors, especially the healthcare sector,” said Arvind Sharma, partner, Shardul Amarchand Mangaldas & Co.

“Needless to mention, the Covid-19 pandemic has exposed the gaps in the healthcare infrastructure across the country. In the second COVID wave, there has been a massive surge in the demand for oxygen cylinders, ICU beds and medical equipment. A need was felt to ramp-up the public healthcare system, and allocation of additional funds will come as a timely aid. It is notable that the additional funds are focused on short term emergency preparedness. I am sure this will aid saving many lives,” Sharma added.

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