May 5th, 2020

// India needs to step up healthcare spending to combat outbreaks such as COVID-19 in future, says GlobalData

India needs to step up healthcare spending to combat outbreaks such as COVID-19 in future, says GlobalData

With an unexpected spike in COVID-19 cases, India has extended the countrywide lockdown till 17 May 2020. The move reflects India’s dependency on lockdown to contain the pandemic amid poor healthcare spending and infrastructure, says GlobalData, a leading data and analytics company.

According to GlobalData COVID-19 dashboard, as of 04 May 2020, although India has  42,505 confirmed cases, fatality rate in India was  3.27% versus  7.06% worldwide, 5.59% in China and 5.84 % in the US. As of 03 May 2020, GlobalData forecasts 10,177,238 confirmed COVID-19 cases in India in a high transmission risk scenario versus 132,388 in a low transmission risk scenario by the end of 2 weeks from now on 14  May 2020.

Bhavani Nelavelly, Pharma Analyst at GlobalData, says: “COVID-19 pandemic shows the need for healthcare system bootstrap in India, as the country is unable to raise the healthcare spending by more than 3.8% of GDP, as compared to the APAC average of 6.64%, even though the country stands at the top in out-of-pocket expenditure with 62.40%. 

“While India has shown a steady increase in healthcare budget allocation, it is still very low in comparison to the other nations with India standing 170 out of 188 countries in domestic general government health expenditure as a percentage of GDP as per the Global Health Expenditure database 2016 of WHO.”

Lockdown may not be the lasting solution for containing virus spread, as it will flare up again after the lifting of lockdown. While the lockdown helped the government to prepare for adequate measures, the extension of lockdown is said to cause US$234.4bn economic loss and result in a stagnant GDP for FY 2020. To compensate for the economic losses, India has already initiated tentative steps to resume the economy with some relaxation given to limited industrial activities.

Though India expanded testing facilities, the country still stands at the bottom compared to rest of the countries in world with respect to testing done as the testing ratio is 760 subjects per million. India has tested 11,07,233 samples as of 04 May , with the first case reported on 30 January. The numbers will certainly rise if the testing sample increases, and unless there is extensive testing, the actual extent of problem can not be understood.

Nelavelly concludes: “As per the current number of confirmed cases, India is not among the worst-hit countries. However, low sample testing, grossly under-funded and patchy public health system pose special challenges for the country's disease containment strategy. India has already increased the funds to fight against COVID-19 by granting US$1.97bn for ‘India COVID-19 emergency’ but that is not enough, the country needs a robust healthcare system and infrastructure to combat the outbreaks like this, which can only be done by strengthening the ability of health-care systems to provide comprehensive care through increase in the health expenditure by government.”


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