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Budget 2013: Healthcare industry seeks increased tax benefits, reduction in import duties


Nikita,CNN-IBN
Feb 24, 2013 at 10:48am IST

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Mumbai: The healthcare industry in India is currently worth 65 billion dollar and is poised to double to 125 billion dollars by 2015. With the Union Budget around the corner, Fortis Hospital is pitching hard for increased allocation and tax benefits for the industry.

Healthcare is still a sorry state of affairs in India. With one hospital bed available for 1000 people, a long-standing demand of the industry has been to grant it infrastructure status, which will facilitate hospitals to get funds for expansion and make India a better place to fall sick!

Dr S Narayani, Facility Director, Fortis, Mumbai, says, "We expect the government to come in through the budget to help us with infrastructure spends to bring up the limitation on the insurance and tax reduction limitation and also help us in terms of expansion and bringing down the import on the medical equipment."

A WHO survey of 175 countries ranks India 171st in terms of total GDP spend on healthcare. In 2012, the government increased the expenditure on healthcare to 2.5 per cent of the GDP but experts say that is still not enough. "Other countries spend 6-17 per cent of their budget on healthcare. I am not suggesting to spend 17 per cent but increase it from 2-2.5 per cent to may be 4 or 5 per cent," says Ameera Shah, MD and CEO, Metropolis Healthcare.

And besides that, the diagnostic industry also seeks a reduction in the import duties on chemicals and kits used for expensive scans and tests. Says Shah, "In diagnostics, all the kits, the chemicals that are used in pathology are imported from Germany, US, France etc and we actually pay customs duty to the government for them. These are life-saving chemicals that will diagnose HIV, hepatitis and all kinds of chronic diseases and we land up paying almost 25-30 per cent customs duty on these to the government. A simple thing that the government could do is stop making money off charging import duties and customs duties on healthcare products."

A long-standing demand of the industry has been to grant it infrastructure status.

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