Economic Survey: Health expenditure grew to Rs 6.1 lakh crore in FY25

New Delhi: The Economic Survey tabled by Finance Minister Nirmala Sitharaman in Parliament on Friday noted that health expenditure in the country grew to Rs 6.1 lakh crore in FY25.

The growth was at a CAGR of 18 per cent and Rs 3.2 lakh crore in FY21, it said.

“Health is a crucial component of human capital and a valuable asset for a prosperous and stable economy. It boosts productivity, reduces healthcare needs, enhances life expectancy, and supports social development,” said the Economic Survey.

It noted that the emphasis on health is important as “India is emerging as an economic powerhouse driven by its youthful population”.

“Government initiatives, including preventive measures, universal access to high-quality healthcare, strengthened public health infrastructure, and advancements in medical education, have collectively contributed to making healthcare in India more accessible and affordable for all,” the Survey noted.

Citing the latest National Health Accounts, the Survey showed that the Total Health Expenditure (THE) has shown an increasing trend since FY19.

In FY22, it was estimated to be Rs 9,04,461 crore (3.8 per cent of the GDP and Rs 6,602 per capita at current prices).

The share of capital expenditure in THE showed an increase from 6.3 per cent in FY16 to 12.7 per cent in FY22.

“This is a positive sign as it will lead to broader and better health infrastructure,” the Survey said.

The Survey noted that an increase in government spending on health has an important implication for the reduction of financial hardship endured by households.

Between FY15 and FY22, the share of Government health expenditures (GHE) also increased from 29.0 per cent to 48.0 per cent.

Notably, the share of out-of-pocket expenditure (OOPE) declined from 62.6 per cent to 39.4 per cent, in the same period.

–IANS