India needs to raise 2.5-3.5% of GDP to support healthcare transformation

healthcare transformation

Covid-19 took India by surprise when the first case was detected in January 2020 that called for the need for a stable healthcare system and equipped to face any unforeseen calamities. According to The FICCI and KPMG in India report titled ‘COVID-19 Induced Healthcare Transformation in India’, the country needs to raise 2.5-3.5% of GDP to support healthcare transformation. In the Union budget 2021-22 the health sector allocation stood at 1.2% of the GDP.


After the pandemic, the country had to move to digitization and cloud-based applications and also forced for expansion and increased adoption of digital healthcare systems across the world. The report also called for alternative finance models to address the financial gaps in the health sector and health coverage for all to support the Universal Health Coverage (UHC) targets. The report also suggests establishing a district-level Health System Index to assess health system maturity, modifying existing district hospitals to implement a hub-and-spoke model, ensuring adequate diagnostic services across all districts, and promoting convergence of public health schemes.

Alok Roy, Chair, FICCI Health Services Committee and Chairman, Medical Group of Hospitals said, “The COVID-19 pandemic exposed weaknesses in our health systems and amplified already existing challenges pertaining to gaps in health infrastructure, workforce and accessibility and equity in health services. But at the same time, it also reinforced an urgent need to make greater investments in augmenting health preparedness and quality of care.”

Lalit Mistry, Partner and Co-Head – Healthcare Sector, KPMG in India said, “The pandemic has transformed the way the government and private players are planning to bring change in the healthcare system.”


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