Online Quiz Test

India’s healthcare system has come a long way, but there are still many obstacles.

GS 2 Health

In Context

  • Experts discuss the development of the Indian health care system and the obstacles it still faces.


  • Throughout the years, the Indian health care system has overcome seemingly insurmountable obstacles that were once deemed hopeless.
  • According to the National Family Health Survey (NFHS-5), India will not achieve a total fertility rate of 2.1 (replacement level) until 2041, even in the best-case scenario.
  • Healthcare in India is on the cusp of a significant transformation due to changing demographics, rising consumer spending, and the emergence of lifestyle diseases.
  • With the youngest population in the world for more than three decades to come, there is a need to confront health challenges in order to fully capitalise on this advantage.

Healthcare Sector of India

  • India’s healthcare industry is one of the largest in terms of revenue and employment, with hospitals, medical devices, clinical trials, outsourcing, telemedicine, medical tourism, health insurance, and medical equipment constituting its components.
  • The healthcare industry in India is expanding at a rapid rate, as a result of increased spending by public and private players, as well as expanding coverage and services.
  • The Indian healthcare industry is projected to reach US$ 372 billion by 2022, a threefold increase with a CAGR of 22% between 2016 and 2022.
  • In 2021-22, India’s public expenditure on healthcare accounted for 2.1% of GDP, with a doctor-population ratio of 1:854.
  • The hospital industry in India is projected to grow at a CAGR of 16–17% from Rs. 4 trillion (US$ 61.79 billion) in FY17 to Rs. 8.6 trillion (US$ 132.84 billion) in FY22.
  • Health insurance companies’ premiums increased to Rs. 73,582.13 crores ($9.21 billion) in FY22.
  • The Indian medical tourism market was valued at $2.89 billion in 2020 and is projected to reach $13.42 billion by 2026, whereas the size of the e-health market is projected to reach $10.6 billion by 2025.


Major challenges of Healthcare Sector in India:

India has made significant strides in its healthcare sector, however, there remain several challenges that need to be addressed.

Health Challenges:

  •  Cardiovascular diseases, cancers, chronic respiratory diseases, diabetes, and obesity are the five main interrelated challenges facing India’s population.
  • Increasing obesity rates, particularly in Delhi, Tamil Nadu, Kerala, Punjab, Telangana, Andhra Pradesh, and Karnataka, increase the risk of other health problems.
  •  Raising awareness and promoting healthy lifestyles are required to save lives and prevent chronic medical conditions.


  • Infrastructure conditions vary between states, with some having superior facilities than others.
  • Urban areas must close the gap between large urban areas and tier II and tier III cities in terms of hospital services.
  • Standalone hospitals and nursing homes provide a much-needed service, but they are unable to provide multi-specialty care, let alone tertiary and quaternary care.
  • The service gaps between metropolitan areas and large cities and rural areas must be closed.

Health Insurance:

  • In the last three years, over four billion Indians have purchased health insurance.
  • The Ayushman Bharat insurance scheme provides hospitalisation coverage of up to Rs 5 lakh per year per family for 10 billion low-income families.
  • Nearly 74% of Indians have health insurance or are eligible for coverage, but millions remain uninsured.
  • Outpatient consultations, diagnostics, and medications continue to be a financial burden for many.

Steps taken by Government:

  • Ministry of Health and Family Welfare (MoHFW) allocated Rs. 86,200.65 crores (US$ 11.28 billion) in the annual budget 2022-23 for major health schemes, such as:
  • Pradhan Mantri Swasthya Suraksha Yojana, National Health Mission, Ayushman Bharat – Pradhan Mantri Jan Arogya Yojana (AB-PMJAY) and PM-ABHIM to strengthen India’s health infrastructure
  • The government has established the National Ayush Mission for the development of traditional medicines in India until 2026 as a centrally-funded programme.

What more can be done?

  • Address lifestyle risk factors: Promote the need for a healthy lifestyle to prevent cardiovascular diseases, cancers, chronic respiratory diseases, and diabetes among the population.
  • Improve infrastructure: Ensure that primary healthcare facilities are fully functional and outfitted with basic amenities, and enhance the provision of essential health services in government-run district hospitals.
  • Bridge the gap in hospital services: Ensure that private hospital chains, standalone hospitals, and nursing homes provide multi-speciality, tertiary, and quaternary care to the population, especially in tier II and tier III cities.
  • Increase health insurance coverage: Expanding the coverage of the Ayushman Bharat insurance scheme and other state-run insurance schemes will encourage more individuals, especially the uninsured, to purchase health insurance.
  • Use AI and digital technology: Leverage the benefits of AI and digital technology in healthcare to improve clinical judgments, surgical procedures, and pandemic forecasting.
  • Implement policies and regulations: Develop and implement policies and regulations to ensure the quality, safety, and affordability of healthcare services across the country.
  • Increase government spending on healthcare: Increase government spending on healthcare to ensure that people have access to affordable, high-quality healthcare.

Way ahead

  • India has successfully reached its replacement fertility rate much earlier than anticipated, in 2020. However, there is a need to raise awareness about healthy lifestyles, and improving infrastructure can save millions of lives by preventing illness and premature death.
  • India’s healthcare sector is highly diversified and full of opportunities in every segment, including providers, payers, and medical technology, and it is a leading destination for high-end diagnostic services with enormous capital investment for advanced diagnostic facilities.
  • India’s healthcare sector is highly diversified and full of opportunities in every segment, including providers, payers, and medical technology.

Future demand for healthcare services is anticipated to increase as a result of rising income levels, an ageing population, growing health awareness, and a shift in attitude towards preventive care.

Source: IE

Daily Mains Question

[Q] What are the most significant obstacles the Indian health care system must overcome, and what initiatives has the government taken to address them?